Innovation in the Baltic Sea Region Final 07072011

April 2011

Innovation in the Baltic Sea region

Final Report to the European Commission, Directorate-General Regional Policy

www.technopolis-group.com

Table of Contents

1. Introduction 1 1.1 Objectives of the study 1 1.2 Scope 2 1.3 Implementation of the study and study team 2 2. An innovation snapshot of the Baltic Sea Region 4 2.1 A diversity in innovation performance and systems 4 2.2 Industrial and technological specialisation in the BSR 6 2.3 Towards smart specialisation in the BSR ? 16 3. Innovation strategies and policies in the BSR 25 3.1 Innovation policies and strategies in the BSR 25 3.2 Research and innovation measures 28 4. The contribution of the ERDF to Baltic Sea innovation policies 34 4.1 The ERDF contribution to national and regional innovation policies 34 4.2 Assessing the contribution of the ERDF to smart specialisation strategies in the Baltic Sea region 40 5. Mapping of national and regional organisations and stakeholders 50 5.1 An institutionally ‘rich’ macro-region 50 5.2 Focus on early stage venture funding organisations in the BSR 54 6. Transnational innovation co-operation in the Baltic Sea Region 57 6.1 Baltic sea co-operation and the EU’s Baltic Sea Region Strategy 57 6.2 Transnational networks and organisations funded by EU programmes 64 6.3 Framework Programme cooperation 69 7. Conclusions and recommendations 74 7.1 Conclusions 74 7.2 Recommendations: a future role for transnational co-operation in supporting Baltic Sea innovation policies 77

Appendices

Appendix A: relevant literature Appendix B: guideline for interviews with key stakeholders Appendix C: results of analysis of policy databases Appendix D: mapping of transnational co-operation in the BSR Appendix E: Evidence on ERDF impact Appendix F: BSR interesting case studies

Innovation in the Baltic Sea region i

Table of Figures

Figure 1:Logic Model of the study...... 3 Figure 2: Employment in high-technology sectors as a percentage of total employment (2008*) in the Baltic Sea Region ...... 4 Figure 3: Growth rates of employment in business services (NACE divisions K 72 and K 74), by NUTS 2 regions, 2006-07...... 7 Figure 4: Number of EPO applications, 2006 and average annual growth 2000-2006 (in brackets) ...... 8 Figure 5: Number of EPO applications per million inhabitants, 2006...... 9 Figure 6: Technological specialisation of Denmark (2006)...... 10 Figure 7: Technological specialisation Finland (2006)...... 10 Figure 8: Technological specialisation of Sweden (2006) ...... 11 Figure 9: High-tech patenting in BSR (2006)...... 14 Figure 10: High tech patenting breakdown in BSR...... 14 Figure 11: Biotechnology patents in the BSR...... 15 Figure 12: Summary specialisation profile for each region...... 17 Figure 13: Summary of policy documents/strategies identified ...... 25 Figure 14: specialisation focus of regional innovation strategies in the BSR ...... 26 Figure 15: National research & innovation measures in the BSR, number per country ...... 29 Figure 16: Priorities of national innovation measures in the BSR...... 29 Figure 17: national research & innovation measures in BSR, thematic focus (n=306) 30 Figure 18: Summary of support measures per Baltic Sea region ...... 32 Figure 19: Policy priorities of regional innovation support measures in the BSR ...... 33 Figure 20: Structural Fund allocations for RTDI 2007-12 in the Baltic Sea regions ... 35 Figure 21: Share of three broad types of RTDI allocation in total RTDI allocations per Baltic Sea region, 2007-13 ...... 37 Figure 22: Comparison of share of SF allocations 2007-13 per region for four FOI.... 38 Figure 23: analysis of relative importance of ERDF in regional innovation systems ...41 Figure 24:estimated contribution of Structural Funds to regional R&D funding...... 42 Figure 25: per capita contribution of SF to regional RTDI compared to per capita gross expenditure on RTDI ...... 42 Figure 26 : BSR Research Infrastructure plans and ERDF support ...... 43 Figure 27: Ratio ERDF allocations 2007-2012 and rate of expenditure ...... 46 Figure 28: Baltic Sea research & innovation organisations per country ...... 51 Figure 29 BSR research & innovation stakeholders and organisations by type...... 51

ii Innovation in the Baltic Sea region

Figure 30: cluster organisations in the Baltic Sea Region ...... 53 Figure 31: Baltic organisation involvement in BSR co-operation ...... 53 Figure 32: BSR organisation involvement in BSR co-operation ...... 54 Figure 33: overview of early-stage funding organisations in the BSR ...... 54 Figure 34: main Baltic Sea region public and NGO 'network organisations'...... 59 Figure 35: Priority 7 flagship project state of completion ...... 63 Figure 36: Overview of BSR Programme 2007-2013 fostering innovation projects ....65 Figure 37 ERANETs: BSR priority fields (FP6& FP7) ...... 66 Figure 38: Europe INNOVA: BSR targeted sectors ...... 68 Figure 39: Summary of projects on clusters under different initiatives ...... 69 Figure 40: BSR participations in FP6 by priority area ...... 70 Figure 41: BSR participations by region in FP6, priority area Sustainable Development, global change and ecosystems...... 71 Figure 42 BSR participations by region in FP6, priority area: information technologies ...... 71 Figure 43 BSR participations by region in FP6, priority area Horizontal research activities involving SMEs...... 72 Figure 44: BSR participations by type of participant in FP6, priority area Horizontal research activities involving SMEs ...... 73 Figure 45 : Number of BSR participants per project, FP6, priority area Horizontal research activities involving SMEs ...... 73

Table of example cases

Case 1: BioCon Valley (Mecklenburg-Vorpommern ...... 15 Case 2 Skåne Food Innovation Network (Skånes Livsmedelsakademi)...... 27 Case 3 The Pomorskie Voivodeship (Poland) – Support for Strategic Clusters...... 28 Case 4 Lithuania – Integrated centres of science, studies and business (“Valleys”) ....45 Case 5 : Assessing the impact of the ERDF on enterprise and innovation in Estonia ..47 Case 5: Systems evaluation of the Finnish Innovation System ...... 48 Case 6: Robotdalen (Sweden)...... 48 Case 8: Uppsala Innovation Centre (UIC) ...... 52 Case 9 Nordic–Baltic Mobility Programme for Business and Industry ...... 58 Case 10: BONUS for Baltic Sea Science – Joint Baltic Sea R&D Programme...... 67 Case 11: Transnational Cluster Cooperation in the ICT field in the BSR: Mobile Vikings ...... 69

Innovation in the Baltic Sea region iii

List of abbreviations

BERD Business Enterprise expenditure on R&D BSR Baltic Sea Region CBSS Council of the Baltic Sea States EIB European Investment Bank EPO European Patent Office ERDF European Regional Development Fund ESF European Social Fund ESFRI European Strategy Forum on Research Infrastructures EUSBSR European Union’s Strategy for the Baltic Sea Region EW ERAWATCH FOI Structural Fund expenditure by field of intervention GOVERD Government expenditure on R&D HEIs Higher education institutions HERD Higher Education Research and Development JRPs Joint Research Projects NB8 Nordic-Baltic 8 framework NCM Nordic Council of Ministers NIB Nordic Investment Bank NUTS Nomenclature of Units for Territorial Statistics (standard code for referencing the subdivisions of countries for statistical purposes. It subdivides each Member State into three levels: NUTs level 1,2 and 3) PRIs Public Research Institutions RCA Revealed Comparative Advantage RIM The Regional Innovation Monitor RTDI Research, Technology Development and Innovation SF Structural Funds STI Science, Technology and Innovation TC InnoPolicy- TrendChart

iv Innovation in the Baltic Sea region

1. Introduction

1.1 Objectives of the study This study provides an overview of existing national and regional innovation strategies of the Member States covered by the European Union’s Strategy for the Baltic Sea Region (EUSBSR). The study was prepared as a background report for a conference on ‘Smart Specialisation and Growth in the Baltic Sea Region’ held from 5-6 April 2011 in Malmö (Sweden). In more detail, the study addresses the following elements.

1.1.1 Policy overview - mapping of existing innovation strategies The study maps the current national and regional innovation strategies that are reflected in the budget of the EU Member States in the Baltic Sea Region (BSR). It examines the strategic focus and, in particular: formation and development of clusters, innovation-friendly environments for business (in areas such as energy, IT, environment and forestry/wood), embedding lifelong learning in research and innovation, strengthening of regional research infrastructure and centres of competence, public procurement and the use of ICT. The mapping takes into account all policy activity and not only those funded through Cohesion policy. An important issue addressed is how assessed activities help to deliver smart specialisation strategies.

1.1.2 Matching of findings with the contribution of ERDF to national and regional innovation policies A core element of the study was to match the results from the mapping with existing data on the contribution of the European Regional Development Fund (ERDF) to national and regional innovation policies. For this task a comparison was made with the findings of a 2010 study (Applica-Ismeri) on the contribution of the ERDF to national and regional innovation policies.

1.1.3 Organisational mapping – who does what? The study identified the main organisations in charge of designing and delivering innovation activities in the EU Member States within the BSR. This resulted in an organisational mapping that addressed the issue of "who does what, and where?"

1.1.4 Transnational cooperation The study examined the extent to which transnational cooperation is reflected in the BSR innovation strategies. A central task was to identify existing cooperation links (including the sectors covered) and to assess to what extent such links are supported by Cohesion policy funded operational programmes and/or the EUSBSR.

1.1.5 Good practice and recommendations Examples from the BSR EU Member States of good practices in innovation policy (particularly with a transnational aspect) were examined so as to inform recommendations and policy options. Of particular interest was the identification of means to overcome barriers for developing an innovative economy through co- operation between academics, entrepreneurs and the financial sector. Building on these examples and the conclusions of the study, the recommendations elaborate on ways to close gaps, avoid overlaps and to ensure that stakeholders work together rather than develop activities in isolation. The most appropriate means to ensure a proper exchange of experience between stakeholders were addressed.

1.2 Scope The Baltic Sea Region in the context of this study covers Denmark, Sweden, Finland, Estonia, Latvia, Lithuania, the German länder of Schleswig-Holstein and Mecklenburg-Vorpommern and the Polish voivodships of Zachodniopomorskie, Pomorskie and Warmińsko-Mazurskie. As requested by the specifications, the definition of innovation used by the Expert Evaluation Network delivering policy analysis on the performance of Cohesion Policy 2007-2013 was applied1.

1.3 Implementation of the study and study team The study was implemented between 2 January and 5 April 2011 and was overseen by a steering committee composed of official of the Directorate-Generals for Regional Policy, Enterprise and Research of the European Commission. During an inception phase, the contractor scanned research and innovation policy databases and literature and prepared an interview guide and reporting template for the regional analysis. In a second phase, a regional level analysis was conducted during February 2011 via: • a review of documentary evidence on innovation policies, including ERDF funded measures, in each region (national level for the three Baltic States); • interviews with officials of DG REGIO (responsible for specific countries) as well as regional and national stakeholders in the BSR (see Appendix B); • Drafting of a short policy brief for each region drawing on the transcripts of the interviews and desk research. In addition, the core study team examined available evidence at EU level on investment and policy priorities in favour of research and innovation in the BSR, EU programme funding allocated to BSR organisation as well as the various transnational and inter-regional initiatives in the BSR. The main reports were drafted by Alasdair Reid and Cristina Navarrete Moreno of Technopolis Group (Brussels). The deliverables are as follows: • D1: Inception report, submitted 7 February 2011 • D2: Interim report –7 March 2011 • D3: Draft final report – 4 April 2011 The following experts provided the country and regional level reporting (including desk study, interviews with key stakeholders and drafting of regional profiles): • Denmark and Sweden: Peter Stern, Jakob Hellman, Miriam Terrell and Linda Blomkvist • Estonia and Finland: Alo Merilo • Germany: Viola Peter • Poland: Jacek Walendowski • Latvia: Aneta Vitola • Lithuania: Jelena Angelis The overall approach to the study is summarised in Figure 1 on the next page.

1 Available at: http://ec.europa.eu/regional_policy/sources/docgener/evaluation/pdf/eval2007/expert_eval_ntw_incep tion_report_synthesis.pdf

2 Innovation in the Baltic Sea region

Figure 1:Logic Model of the study

2. An innovation snapshot of the Baltic Sea Region

2.1 A diversity in innovation performance and systems The current regional innovation performance in the BSR, as measured by the main research and technological development and innovation indicators used in most analysis and scoreboards, is clearly a reflection of a number of factors including industrial structure (i.e. relative specialisation in lower to high-tech industrial and business service sectors), stage of development, sophistication and quality of education and public and higher education research systems and public investment into these sectors. However, it also reflects ‘institutional’ and ‘cultural’ propensities to co-operation for innovation, risk-taking and entrepreneurial behaviour. In terms of absolute and even relative levels of investment in R&D and innovation there is a clear north-west / south-east split in the Baltic Sea. In short, the intensity of investment (gross expenditure on R&D as a share of GDP) in Denmark, Finland and Sweden is at three times (or more) the level of the Baltic States and Polish region. Even the two German regions are, from a national perspective, ‘weaker’ regions. Government expenditure on R&D (GOVERD) as a percentage of GDP varies between 0.2% (Latvia) and over 1% in Finland and Sweden. A similar diversity can be identified in terms of industrial structures with the share of employment in high-technology sectors relative to total employment (a standard measure of relative specialisation) ranging from 90.6% in Hovestaden (DK) to 1.15% in Warminsko-Mazurskie (PL). While, as can be seen from Figure 2, regional performance is related to overall national performance, there are clear intra-country differences with Danish (Nordjylland, Syddanmark), German (Schleswig-Holstein) and Swedish (Övre Norrland, Norra Mellansverige, Småland med öarna) featuring in the lower half of the ranking) well below respective national averages and the EU27 average of 3.27%. On the other hand, Estonia is close to the EU27 average and Pomorskie has a similar above average position to a number of Nordic regions. Figure 2: Employment in high-technology sectors as a percentage of total employment (2008*) in the Baltic Sea Region

Source: Eurostat (htec_emp_reg2) High-technology sectors = high-technology manufacturing and knowledge-intensive high-technology services * Meckelenburg-Vorpommern, 2007.

4 Innovation in the Baltic Sea region

A strategy for innovation for the Baltic Sea region that ignores this diversity of ‘baseline’ situation and which assumes that ‘all partners are equal’ is bound to fail. Using the 2009 regional innovation scoreboard rankings, the Baltic Sea regions can be split into three broad groups2: i) Highly innovative with significant strengths in both business innovation and academic R&D: Nordic capital regions and regions with a high tech advanced business or research poles (Gothenburg, Oulu, Turku, etc.). In many of these regions, business strategies are the driving force in innovation funding (accounting for over 60% of investment), while public interventions focus on developing new and emerging platforms. ii) Medium-high innovators but with weaker business innovation: Nordic secondary regions (East Finland, northern Sweden, rural parts of Denmark), Schleswig-Holstein and Mecklenburg-Vorpommern, Estonia (latter somewhere in between 2nd and third groups). Investment tends to be driven by a mix of public and higher education sector but with average to above average business performance. iii) Low to medium-low innovators driven essentially by public (& higher education) investment: the three Polish regions (with Pomorskie better placed), Latvia and Lithuania. Hence, these distinctive innovation systems imply a need for different policy ‘mixes’. For instance, the third type of BSR regions are in an ‘investment phase’ in terms of rebuilding a ‘competitive’ public and higher education research system and of increasing the limited (human and financial) capacity for investing in R&D by businesses that are often concentrated in lower tech sectors. The more advanced BSR are competing globally and like the medium-high regions are shifting policy attention towards knowledge intensive services, creative industries or new higher tech clusters. Sectors like the creative industries can also be a key driver in even less ‘high-tech’ countries. For instance, according to the 2010 European Competitiveness Report (EC, 2010)3, the Baltic States have amongst the highest annual employment growth rates in the creative industries sector (software consulting accounted for more than half of creative industries’ employment growth in the EU27) in 2000–2007. Public policy can intervene directly to support investment in public or higher education research systems or to support the creation (or attraction of inward investors) and development of ‘higher-tech’ firms, which over time may help to shift regional ‘specialisation’ towards business activities that generate higher income and employment. However, such processes take time since changing the ‘historical’ economic structure of a region is not a matter of a few years. Equally, policy also needs to address system failures explaining ‘innovation and entrepreneurial propensities which can often be more challenging. The same remark about the diversity of capabilities and performance applies to the sophistication of policy, to the level of development of clusters, of management of research in higher education, etc. Finally, even if innovation policy aims to influence business to shift to become more specialised in specific sector (or technologies), the reality of globalised supply chains and trading patterns may undermine such shifts (EC, 2010).

2 These three broad groupings are based on the analysis of the European Regional Innovation Scoreboard approach as well as drawing on the work of the Regional Innovation Monitor. For further information, see the typology of regions proposed in the 2010 - Annual Report of the Regional Innovation Monitor "Innovation Patterns and Innovation Policy in European Regions - Trends, Challenges and Perspectives" available at : http://www.rim-europa.eu/index.cfm?q=p.reportDetails&id=15138; and the classification of regions in the 2009 Regional Innovation Scoreboard report available at : http://www.proinno- europe.eu/page/regional-innovation-scoreboard 3 Commission staff working document, European competitiveness report 2010. An integrated industrial policy for the globalisation era. Putting competitiveness and sustainability at front stage (Com(2010) 614)/

2.2 Industrial and technological specialisation in the BSR In order to examine, further the issue of whether the BSR regions are more or less specialised in certain sectors or technologies, the study team carried out both a literature review at regional level and also analysed available statistics. The next section recalls briefly the methods used to calculation specialisation indices.

2.2.1 Measuring specialisation and concentration There are a number of regional specialisation indices as well as measures for regional concentration. Traistara and Iaru (2002) summarise the definitions on regional specialisation and geographic concentration of industries in relation to production structures. Thus, regional specialisation is defined as the distribution of the shares of an industry i in total manufacturing in a specific region j compared to a norm. A region j is specialised in a specific industry i if this industry has a high share in the manufacturing employment of region j. The manufacturing structure of a region j is ‘highly specialised’ if a small number of industries have a large combined share in the total manufacturing. Used indices are for example the Gini coefficient of regional specialization or the Krugman specialisation index. Geographic concentration measures the distribution of the shares of regions in a specific industry i. A specific industry i is said to be ‘concentrated’ if a large part of production is carried out in a small number of regions. Indices used are the Herfindahl index or the Dissimilarity index of geographic concentration. Patents as an output of innovation activities capture, to some extent, the technological capabilities of firms, industries, countries or regions. Relative technological specialisation is defined as the technological performance of a country or region in a specific technological field relative to its overall international technological performance. Different countries and regions have different propensities to patent. This is not only due to their size, their research orientation or the degree of internationalisation. Another important factor is the differing propensity of different technological fields to be patented: even assuming relatively similar R&D expenditures, the chemical or pharmaceutical industry has a rather high propensity to patent, while the number of patents in mechanical engineering or the automobile sector is much lower. To overcome the size and propensity effects and to make technological fields as well as countries and regions comparable, specialisation indices as well as patent intensities (application per 1 million inhabitants) are used. As a parameter to determine patent specialisation, the Revealed Comparative Advantage (RCA) methodology according to Balassa’s formula (1965) is used. This RCA value has the following definition:

RCAki = 100 x tanh ln {(Aki/∑iAk)/(∑kAki/∑kiAki)} with Aki indicating the number of patents of country k in the field i, whereby field i is defined by patent classes. RCA values are here limited to a range of +100 to -100 due to the logarithms. Positive values for field i point to the fact that it has a higher weight in the patent portfolio of the country than its weight in the world (all patents from all countries taken together). Negative values indicate specialisation of A below the average, respectively. Values around zero, negative as well as positive, are distinguished from a positive or negative specialisation and labelled 'as expected' or 'world average'. This indicates that the calculated share equals the mainstream, or world average. In a range from -100 to 100, values from -20 to 20 are ‘around world average’ and should not be labelled specialised. To be positively or negatively specialised in patent classes that form technological fields, a country or region needs to divert from the world average.

6 Innovation in the Baltic Sea region

2.2.2 Industrial specialisation In the absence of trade data at regional level4, the main economic (business) indicator used to identify specialisation is employment in specific sectors. Eurostat (2010)5 presents an analysis of regional specialisation and concentration of manufacturing and service sectors. The report notes that there are various reasons for relative specialisation, including availability of natural resources, availability of skilled employees, culture and tradition, cost levels, infrastructure, legislation, climatic and topographic conditions and proximity to markets. Indeed, the findings of the analysis are not particularly surprising. The regions most specialised in food and beverages manufacturing (NACE 15) were all located in rural areas in or close to agricultural production centres, including Warmińsko-Mazurskie; while the heavily forested Nordic and Baltic regions were the regions most specialised in the manufacture of wood and wood products (NACE 20) and in the related manufacturing of pulp, paper and paper products (NACE 21). Itä-Suomi (Finland) was the most specialised region in wood and wood products and Norra Mellansverige (Sweden) in pulp and paper. A number of other BSR regions were amongst the most specialised in the EU27 in 2007 for specific sectors including: Warmińsko-Mazurskie (PL62) for furniture and other manufacturing (36); Radio, TV and communication equipment (32), Pohjois-Suomi (FI1A) and Övre Norrland (SE33) for metal ores. As much as current specialisation patterns require careful consideration by policy makers when designing innovation policies, trends in the share of different sectors are also important. For instance, Figure 3, illustrates that a number the less advanced regions are showing relatively strong growth rates in business services suggesting that there is a process of structural change occurring. Figure 3: Growth rates of employment in business services (NACE divisions K 72 and K 74), by NUTS 2 regions, 2006-07

Source: Eurostat

4 Making it impossible to analyse, for instance, revealed comparative advantage as was done for instance in the European Competitiveness Report 2010 for intermediate products at national level. The national level data from this report tends to confirm that Estonia and Latvia have a comparative advantage in intermediate goods (as suppliers in global supply chains), Denmark and Poland in consumer goods; while Germany, Finland and Sweden have a comparative advantage in capital goods. 5 Eurostat Regional Yearbook 2010

2.2.3 Patenting in the BSR Regional data from Eurostat has been used6 to analyse patenting activity in the BSR at regional level. Such an analysis is problematic since while it is, of course, possible to provide the absolute numbers, the calculation of technological specialisation needs a ‘critical mass’ to be relevant. If a region has less than 70 patents per year, it is impossible to calculate specialisation given that the absolute number of patent applications at the European Patent Office (EPO) alone was about 130,000 in 2007. This said, the analysis suggest the BSR is rather diverse in terms of technological capacities. In 2006, the number of patent applications at the EPO ranged from nine in Polish regions to more than 2,500 in Sweden (Figure 4). Figure 4: Number of EPO applications, 2006 and average annual growth 2000-2006 (in brackets)

DK0 ‐ Denmark (1.8) 1049 DE8 ‐ Mecklenburg‐Vorp. (7.7) 95 DEF ‐ Schleswig‐Holstein (2.0) 413 EE0 ‐ Estonia (8.9) 10 LV0 ‐ Latvia (7.0) 12 LT0 ‐ Lithuania (12.2) 10 PL4 ‐ Pólnocno‐Zachodni (36.0) 19 PL6 ‐ Pólnocny (7.0) 9 FI1 ‐ Manner‐Suomi (‐1.4) 1299 SE0 ‐ Sweden (1.7) 2534 SE1 ‐ Östra Sverige (1.3) 1160 SE2 ‐ Södra Sverige (2.3) 1078 SE3 ‐ Norra Sverige (‐2.7) 227

0 500 1000 1500 2000 2500 3000

Data: Eurostat, Calculations Technopolis Group Of course, this reflects the different size of the regions. However, even if the population size is taken into account, large differences prevail (Figure 5). The leading BSR regions are located in Sweden, Finland, and Denmark. Indeed, with more than 200 patents per million population on an annual basis these three countries are among the top patenting EU27 countries (see RKF 2010). Taking population into account, Sweden is still far ahead of Finland, Denmark, and Schleswig Holstein. Considering the (old) Swedish NUTS1 level regions, West Sweden (SE1) is the leading region in the BSR and even above the Swedish total per capita.

6 Although for some regions provisional 2007 data is already available, 2006 data is used as this is complete and validated

8 Innovation in the Baltic Sea region

Figure 5: Number of EPO applications per million inhabitants, 2006

DK0 ‐ Denmark 193 DE8 ‐ Mecklenburg‐Vorpommern 56 DEF ‐ Schleswig‐Holstein 146 EE0 ‐ Estonia 08 LV0 ‐ Latvia 05 LT0 ‐ Lithuania 03 PL4 ‐ Pólnocno‐Zachodni 03 PL6 ‐ Pólnocny 02 FI1 ‐ Manner‐Suomi 248 SE0 ‐ Sweden 280 SE1 ‐ Östra Sverige 340 SE2 ‐ Södra Sverige 274 SE3 ‐ Norra Sverige 133

00 50 100 150 200 250 300 350 400

Data: Eurostat, Calculations Technopolis Group It is also worth noting, that while an upward trend in the internationalisation of R&D investment is visible in most countries, that the share of the total stock of EPO patents that is foreign owned differs significantly between the three Nordic BSR countries (below 20% of EPO patents are foreign owned in Denmark, Finland and Sweden) compared to the three Baltic States (around half of all EPO patents are foreign owned in Estonia, slightly above 40% in Latvia and close to 60% in Lithuania)7. This suggests that the output of R&D activity in the latter countries is much more ‘internationalised’ than in the Nordic ‘innovation leaders’. This finding likely reflects the dominant role of foreign direct investment companies in the innovation systems of the Baltic States.

2.2.4 Technological specialisation in the BSR The low absolute patent numbers for many BSR regions/countries does not allow calculating relative technological specialisation patterns over time. Small upwards or downwards shifts in absolute (low numbers of) patents in a given class result in extreme amplitudes.8 However for those regions with a statistically significant number (i.e. Sweden, Finland, and Denmark), detailed technological specialisation profiles were calculated for the periods 1995-96, 1999-2000 and 2004-05 (see figures below). Technological specialisation is of course a reflection of the existing industrial structure and hence, the three countries have different profiles. The list of technologies is ‘ranked’ from a lower/medium degree of technology to high technologies. Denmark for example is positively specialised over time in 11 medium as well as high technologies. Among the technologies the country is specialised over time is power generation and distribution, agricultural machinery, pharmaceuticals, or biotechnology and agents. Finland is specialised in six technologies: power generation and distribution and agricultural machinery (similarly to Denmark), but also in communication engineering and weapons. Sweden is less often specialised with a positive specialisation in air conditioning/filter technology, pharmaceuticals, communication engineering, and nuclear reactors and radioactive elements.

7 European Competitiveness Report 2010 8 This is the case for the Polish and German regions, but also for the three Baltic States. The total number of patent applications is far too low to calculate robust specialisation profiles.

Figure 6: Technological specialisation of Denmark (2006)

rail vehicles optical and photo‐optical devices medical instruments lamps, batteries etc. ofice machinery machine tools air conditioning and ilter technology rubber goods other special chemistry pyrotechnics polymeres inorganic basic materials optics electronic medical instruments electronics aeronautics biotechnology and agents nuclear reactors and radioactive elements ‐100 ‐50 0 50 100

2004-2005 1999-2000 1995-1996

Source: Regional Key Figures 2010, DG-RTD Figure 7: Technological specialisation Finland (2006)

rail vehicles optical and photo-optical devices medical instruments lamps, batteries etc. office machinery machine tools air conditioning and filter technology rubber goods other special chemistry pyrotechnics polymeres inorganic basic materials optics electronic medical instruments electronics aeronautics biotechnology and agents nuclear reactors and radioactive elements ‐100 ‐50 0 50 100

2004-2005 1999-2000 1995-1996

Source: Regional Key Figures 2010, DG-RTD

10 Innovation in the Baltic Sea region

Figure 8: Technological specialisation of Sweden (2006)

2004-2005 1999-2000 1995-1996

Source: Regional Key Figures 2010, DG-RTD

2.2.5 Regional patenting As noted above, regional level patenting data, for 2006, is available at NUTS 1 level for the larger BSR countries: Denmark, Sweden, and Finland, with an clear internal north-south divide of patenting activities in Finland and Sweden9. The breakdown by technology classes is based on IPC classes, which are aligned to technologies and industries. Section A for example covers agriculture, sports; games; amusements; footwear; wearing apparel; tobacco; cigars; cigarettes; smokers' requisites; etc.

2.2.5.1 Denmark Denmark is one of the leading patenting countries in Europe with, in 2006, more than 1,000 patent applications to the EPO. One third of the patents were in “Human necessities”. In terms of growth rates, Section F - Mechanical engineering; lighting; heating; weapons; blasting shows the highest average annual growth between 2000- 2006 with 7.5%, followed by Section A - Human necessities with 3.9%. When Human necessities is analysed further, the following sub-classes are prominent: • 67% in Medical or veterinary science; hygiene, • 8.6% in Foods or foodstuffs, • 8.2% Agriculture; forestry; animal husbandry; hunting; trapping; fishing, and

9 Only with the rather recent changes of the NUTS system in Denmark, NUTS1 level patent analysis is introduced by EUROSTAT. However, it starts with provisional data for the Danish regions for 2007 only. From the so far available regionalised patent data, a wide dispersion can also be found in Denmark.

• 7.9% in Furniture; domestic articles or appliances; coffee mills; spice mills; suction cleaners in general 78% of the patents in the field of Medical or veterinary science; hygiene come from Hovedstaden – the capital region. Agriculture is strong in Midtjylland, while food is dominant in the capital region. Furniture and other creative industries’ patents can be found in Nordjylland, with a slight concentration within Syddanmark.

2.2.5.2 Sweden Sweden is a leading EU country for patenting countries with more than 2,500 patents in 2006. 28% of all patenting occurred in Section H – Electricity, followed by Section B - Performing operations; transporting (18.6%) and Section A – Human necessities (17.4%). The Electricity section is also the one with the highest growth rate between 2000-2006 with 3.2%; followed by Section B with 2.4%. While section E is a homogenous section, Section B is not. Thus, a further analysis of this section revealed the following main patenting fields: • 25% in Vehicles in general • 9.1% in Hand tools; portable power-driven tools; handles for hand implements; workshop equipment; manipulators • 9% in Machine tools; metal-working not otherwise provided for • 6.8% in Physical or chemical processes or apparatus in general 60% of the Vehicles in general patents come from Södra Sverige (SE2), and within this NUTS1 region, it is concentrated in Västsverige (SE23). Hand tools patents are concentrated in Östra Sverige (SE1), with 80% of the patents in this field. North Sweden, the least important region in terms of patents has the highest number of Machine tools patents with 37%. A similar analysis for the Section A reveals the following targeted fields: • 72% in Medical or veterinary science; hygiene, • 11% in Furniture; domestic articles or appliances; coffee mills; spice mills; suction cleaners in general • 7% in Agriculture; forestry; animal husbandry; hunting; trapping; fishing In the Medical or veterinary science; hygiene field 48% of patents are from Östra Sverige and 75% of this share from Stockholm alone. The south is also quite strong with a similar share of 47% of which 50% come from Västsverige (SE23) (Gothenburg with a number of major health research institutes).

2.2.5.3 Finland Finland had 1,300 EPO patent applications in 2006 and is also one of the main patenting countries in the EU. Between 2000-2006, many sections faced a decline in terms of patenting; Section D – Textiles, paper lost 10% on average annually. A growth field with 8.7% is Section E – Fixed constructions. As expected the Electricity Section H is dominant with 39% of patents and Finland is also strong in section G – Physics with almost 20% of all patent applications. This section covers a number of sub-fields worth analysing on this sub-level. In this field, Finland has the following priorities: • 50% in Computing; calculating; counting, • 28% in Measuring (counting G06M); testing, • 7% in Musical instruments; acoustics • 6.7% in Optics Computing and Measuring are concentrated in Etelä-Suomi, 60% of all computer patents and 50% of all measuring patents are from this region, while Musical

12 Innovation in the Baltic Sea region

instruments patents are essentialy from Länsi-Suomi, but Optics patents are more evenly dispersed over the regions with a slight dominance of Etelä-Suomi.

2.2.5.4 Estonia, Latvia and Lithuania All three Baltic States recorded very low number of EPO patent applications in 2006, respectively 11, 12 and 10 for Estonia, Latvia and Lithuania. The small absolute number of patents and the absence of patents in some fields suggests, firstly, that the business sector is not oriented internationally (therefore a national patent may suffice) and secondly, that there is an absence of industries, or of R&D performing firms, in some key fields. Hence, given the low number of patents, it is not possible to identify a technological specialisation for these three countries. In Latvia, section C – Chemistry; metallurgy is clearly dominant but the eight patents do not provide a sufficiently strong technological base.

2.2.5.5 Polish regions: Pomorskie, Warminsko-Mazurskie and Zachodniopomorskie The Polish region of Pomorskie had three EPO patents in 2006. Although a relatively strong industrial region, the region’s industrial structure is predominantly petrochemical and shipbuilding; industries with a rather low propensity to patent. Warminsko-Mazurskie had two EPO patents in 2006. Again, the industrial structure is one explanation, since the regional contribution to national gross value added is marginal (less than 3%), with one quarter provided by industry, and the region is largely agricultural. Zachodniopomorskie had five EPO patent applications in 2006. The region is focused on a marine-based and agricultural economy, which includes ports but also tourism. Despite a large number of micro companies (RIM 2011), the current industrial structure does not necessarily foster R&D activity leading to international patents.

2.2.5.6 Mecklenburg-Vorpommern Mecklenburg-Vorpommern is the least patent-intensive region in Germany. On average there are 70 patent applications at the EPO annually, in 2006 a record of 95 was achieved and indeed, between 2000-2006, the region had an average annual growth rate of 7.7% in EPO patents. Section H – Electricity had the highest growth rate of 41% (an absolute increase from 3 to 22), followed by Section F - Mechanical engineering; lighting; heating; weapons; blasting with 13.4%.

2.2.5.7 Schleswig-Holstein Schleswig-Holstein is also not among the leading German technological regions. In 2006, it had 385 patents. Section D – Textiles, paper enjoyed the highest growth with 20% between 2000-2006 – yet, the section has the lowest absolute number of patents. Declining shares can be found in Chemistry, metallurgy, Physics, and Electricity. About 35% of all patents are in the Section B - Performing operations; transporting. A closer analysis of the section revealed that: • 14% are in Vehicles in general, • 14% are in Conveying, packing, • 8.8% are in Physical or chemical processes or apparatus in general, • 8.8% are in Ships or other waterborne vessels; related equipment.

2.2.6 High-tech patenting High-tech patenting is an interesting sub-set of a small number of highly important patent sections. The BSR obtained almost 1,500 high-tech patents in 2006, mainly from Sweden and Finland. However, between 2000-2006, high-tech patent applications fell in all Baltic Sea regions with the exception of Södra Sverige (5.4%)

and, albeit from very low levels, in Mecklenburg-Vorpommern (9.4% 20 high-tech patents) and Estonia (22.4%, four high-tech patents). Figure 9: High-tech patenting in BSR (2006)

Danmark 197 Hovedstaden 139 Sjælland 11 Syddanmark 10 Midtjylland 20 Nordjylland 18 Mecklenburg-Vorpommern 20 Schleswig-Holstein 42 Estonia 4 Latvija 0 Lietuva 3 Zachodniopomorskie 2 Warminsko-Mazurskie 1 Pomorskie 0 Manner-Suomi 549 Itä-Suomi 6 Etelä-Suomi 339 Länsi-Suomi 130 Pohjois-Suomi 75 Östra Sverige 332 Södra Sverige 290 Norra Sverige 39

0 100 200 300 400 500 600

Source: Eurostat, calculations Technopolis Group Looking at the breakdown by individual high technologies, the BSR is clearly focussed on communication technology with 60% of high-tech patents in this field, basically thanks to Finnish and Swedish regions. Figure 10: High tech patenting breakdown in BSR

Laser Computer and Semi- conductors 1% automated 4% business equipment 24%

Micro-organism and genetic engineering 9%

Communication Aviation technology 60% 2%

Source: Eurostat, calculations Technopolis Group

14 Innovation in the Baltic Sea region

Figure 11: Biotechnology patents in the BSR

Danmark 114 Hovedstaden 94 Sjælland 6 Syddanmark 5 Midtjylland 8 Nordjylland 1 Mecklenburg-Vorpommern 9 Schleswig-Holstein 9 Eesti 3 Latvija 0 Lietuva 3 Zachodniopomorskie 2 Warminsko-Mazurskie 0 Pomorskie 1 Manner-Suomi 33 Itä-Suomi 2 Etelä-Suomi 27 Länsi-Suomi 1 Pohjois-Suomi 2 Sweden 96 Östra Sverige 58 Södra Sverige 32 Norra Sverige 4 0 20 40 60 80 100 120 140

Source: Eurostat Similarly to other high tech patent fields, the number of biotechnology patents from the BSR has been falling, by 4.3% on average annually from 2000 to a total of 268 biotechnology patents in 2006. Indeed, while the biotech sector grew until 2004, since 2005 patent applications are falling. Denmark is still the leading country in the BSR when it comes to biotechnology patents, with 82% of its biotechnology patents are coming from the capital region. However, Denmark’s absolute number of biotechnology patent applications fell 4.7%, Sweden’s 5.1% and Finland’s fell 1%. Case 1: BioCon Valley (Mecklenburg-Vorpommern BioCon Valley is the regional life-science cluster in Mecklenburg-Vorpommern. It dates back to 1996 when the federal “BioRegio” competition was launched and 17 regions competed for funding of over €100 million. Although Mecklenburg-Vorpommern was not among the winning regions, the effort to set up a regional network resulted in the establishment of the cluster, and all of the 17 original regions are now part of the 25 German ‘bio-regions’. BioCon Valley aims to promote cooperation with other regions, in particular from the BSR, in the field of life sciences. It has roughly 160 members from industry, research, public bodies and support organisations, who actively support the aim to make the region the leading German health economy region. The cluster, which started to establish cooperation with international partners early on, is partially financed by its members and by funding coming from ERDF and the federally funded initiative hic@re. As a network broker, the BioCon Valley cluster initiative has brought a noticeable stimulus for the regional development in Mecklenburg-Vorpommern. Its technological focus helps the region to develop a unique profile within Germany, while, its inclusion in ScanBalt means the wider BSR is a source of potential cooperation partners. The smart specialisation strategy of Mecklenburg-Vorpommern is a model for several other, industrially weaker regions, for instance, from Poland and the Baltic States. The choice of biotechnology – life sciences is somewhat due to chance – and the established bottom-up initiatives have create a dynamic that was taken up and fostered by the regional government. Source: BioCon Valley (2008): Branchenreport 1-2008. BioCon Valley (2008): Annual report 2008; Dohse, D. (2005): Clusterorientierte Technologiepolitik in Deutschalnd: Konzepte und Erfahrungen, in: Technikfolgenabschätzung Theorie und Praxis, 14/1, pp.33-41 DPMA (2007): Patentatlas. http://www.biotechnologie.de/BIO/Navigation/DE/Hintergrund/studien- statistiken,did=48336.html

2.3 Towards smart specialisation in the BSR ? The preceding sections have summarised available statistics and evidence on innovation potential, industrial structures and trends and technological specialisation. In addition, to the analysis of data at EU level, the regional briefs give further insight into the emergence of new clusters or sectors. The main elements of the regional briefs are summed up on the following pages in Figure 12. Clearly this report has had to adopt a ‘broad-brush’ approach given the time and resources available but both the statistical analysis and the descriptive summaries of evidence from each region, underline that there is both a ‘natural’ (resource based, maritime trade centres, major or capital cities where services and creative industries cluster etc.) and ‘path dependent’ (existence of an industrial tradition in certain sectors, etc.) explanation for much of the At the same time, the potential to ‘evolve’ the specialisation patterns to more knowledge intensive services or higher-tech and higher value added manufacturing sectors is dependent on the ‘innovation system’ that is in part fostered by public policy interventions. In this respect, the ‘innovation gap’ between the various regions round the BSR is significant. However, the performance of specific regions varies depending on the indicators analysed and trends such as the high growth rates in creative industries or business services in some of the less favoured regions tend to underline that a number of the ‘less advanced’ regional economies are under-going significant structural change. To sum up, the conclusions that can be drawn from the analysis include: • Although the regions of the ‘south-east coast’ of the BSR are significantly weaker in terms of technological innovation capacities and potential. These regions may be classified as ‘knowledge absorbing regions’, in the sense that their first priority should be to upgrade productivity of the business sector through ‘embodied innovation’ (acquisition of machinery and equipment, retraining, etc.). However, emerging ‘clusters’ in the German and Polish regions and the Baltic States provide a basis around which a smart specialisation policy can be built. • A significant share of current business activity is related to a natural ‘specialisation’ or industrial traditions that are major employers and the development of such sectors, not always considered amongst ‘high-tech’ policy priorities. These include construction, wood, paper and pulp, minerals and metals, and a critical sector in many of the BSR regions, namely food & drinks. Smart specialisation policies need to take such sectors into account when deciding where to prioritise investments into innovation infrastructure. Equally, services including (maritime) transport but also financial and business services merit attention. • As a whole the BSR, does appear to be ‘specialised’ in a certain number of key technology fields, notably ICT and biotechnology (a more detailed analysis by sub- fields would be required to understand where synergies and complementarities exist between regions). Such common specialisation offers the potential for BSR wide technology programmes.

16 Innovation in the Baltic Sea region

Figure 12: Summary specialisation profile for each region

Region/ Country Specialisation focus of research & Leading sectors/clusters Key scientific and research centres/ innovation policy infrastructures

Estonia • Technology programmes in the fields of ICT, • Transport and logistics • Four public universities with research biotechnology, material technologies, energy, • Energy concentrated in Tartu and Tallinn Technology national defence and security • Construction • Tallin Technology Park and Tartu Science Park • Estonian Research Infrastructures Roadmap published in 2010 & ERDF co-financed • ICT programme supports R&D infrastructure • Business services • Competence centres funded (incl. by ERDF) • Processed food since 2004 (electronics, cancer research, food, etc.)

Etelä-Suomi (FI) • Cooperation and networking of innovation actors • ICT • Home of Finnish Innovation Fund (Sitra) and SMEs, • Business services • Academy of Finland • Innovation services • Energy • Finnish Funding Agency for Technology and • Business incubators • Construction Innovation (Tekes) • Special knowledge of areas • Healthcare • Research and Innovation Council • Electronic advisory and customer service systems • Applied research.

Hovedstaden (DK) • Development of stronger clusters, especially the • Life science and bio-tech • University of Copenhagen (the largest university development of cleantech clusters • Environment, cleantech and renewable energies in Northern Europe), the Technical University of • Entrepreneurs growth and business development Denmark and the Copenhagen Business School. (e.g. CIBIT Accelator project for Danish start-up • Symbion science park and incubators: IT, and small businesses) biotechnology, medical • Life sciences & biotech (e.g Healthcare Innovation Centre) • Development of the workforce (represents 19% of total investment of Growth Forum)

Itä-Suomi (FI) • Specific attention paid to wellness technology, • Agriculture, • University of Eastern Finland, with four faculties environmental knowledge, measurement • Services (incl. public administration) notably, Faculty of Science and Forestry and the techniques, optics and sensor technology as well Faculty of Health Sciences as the creative industries. • Machinery, forestry, pulp and paper

Region/ Country Specialisation focus of research & Leading sectors/clusters Key scientific and research centres/ innovation policy infrastructures

• R&D activities concentrated in new emerging sectors such as health and to stimulate the well established sectors such as machinery, forest and paper.

Länsi-Suomi (FI) • ICT • ICT • University of Tampere • Bio-technology and medical technology • Electric engineering and mechanical engineering • Tampere University of Technology • Engineering • VTT Technical Research Centre of Finland • Automation • Optoelectronics and laser technology • Services industry

Latvia • Five broad fields: • Information technologies • University of Latvia − Energy and environment • Logistic • Riga Technical University − Innovative materials and technologies • Food processing • Riga Srandins University − National identity • Metalworking/processing • Latvia University of Agriculture − Public health, Sustainable use of local resources • Horizontal support measures for clusters development

Innovation in18 the Baltic Sea region

Region/ Country Specialisation focus of research & Leading sectors/clusters Key scientific and research centres/ innovation policy infrastructures

Lithuania • Ensure the quality of human life (including • Photo-electronic –InnoCluster LT • Kaunas University of Technology biotechnology ecosystems, and climate changes); • Eight sectors identified as having potential for • Vilnius Gediminas Technical University • Research intended for the development of a clusters: • Klaipeda University knowledge-based society (e.. ICT); − Machinery and equipment manufacturing nanotechnologies; nuclear safety; • Lithuanian Innovation Centre − Wood processing and furniture • 5 Science industry clusters/Valleys • Several science and technology parks active in − Textile and clothing the international sphere eg. KLaipeda Science − Biomedical research − Food and drinks and Technology Park, KTU Regional Science − Laser technologies and material sciences Park − Chemicals − Chemistry and mechatronics − ICT − Agro science − Biotechnology − Marine science − Laser and its components

Mecklenburg- • Health economy fields • Bio-technology • MPI for Plasma Physics Vorpommern (DE) − Health prevention • Plasma science • Leibniz Institute for Plasma Science − Health tourism • Other modern life and health care related fields • University Greifswald − Rehabilitation − Food − Health ageing • Science-based technologies − Bio-medicine − Plasma

Region/ Country Specialisation focus of research & Leading sectors/clusters Key scientific and research centres/ innovation policy infrastructures

• Increase policy importance to education • Cluster initiatives in areas such as forestry (Fibre • Mid Sweden University has six research profiles Mellersta Norrland (SE) programmes, as well as to research capability, in Network, Packaging Mid Sweden and Ywood), related to regional issues, e.g. digital society, technical chemistry, connected with the energy (Biofuelregion ) ,process forestry and tourism, etc chemistry and bio-refinery trust in Domsjö. industry/biorefinery (Processum) and • In Mittuniversitetet greater focus is been placed tourism/sports/equipment (Peak Innovation) on research profiles as: the digital society, • Other recent cluster initiatives e.g. in the field of learning & education, the forest as a resource, safety and security. tourism, sports & experience technology

• Highest priority is given to supporting the start- • Environment and renewable energies: (e.g • University of Aarhus and the Aarhus University Midtjylland (DK) up and development of innovative companies biogas, wind turbines pumps and other industrial Hospital • Especial focus on environment and energy machines. • Agro Food Park supported by the Plan for energy and • Healthcare and life science • Several key centres supporting bio-tech and environment • Food (e.g. dairy, food ingredients & sweeteners health care sector (Centre for Public health, , In addition, healthcare and foods sector are well and sugar). Med-tech innovation centre and Centre for supported Pervasive healthcare)

Nordjylland (DK) • Renewable energy and new energy forms • ICT • Aalborg University, e.g. Centre for Policy focus on clusters in traditional industries • Teleinfrastructure including food, construction and maritime • Manufacturing clusters, while the high tech industries include ICT and health cluster • Creative industries and tourism

Norra Mellansveige (SE) • Innovation platforms • Pulp & paper • Teknikdalen Foundation − High Voltage Valley • Forest products • Borlänge Science Park − The Packaging Arena • Metal manufacturing • Sandbacka Park − Fiber Optic Valley − Triple Steelix

Innovation in20 the Baltic Sea region

Region/ Country Specialisation focus of research & Leading sectors/clusters Key scientific and research centres/ innovation policy infrastructures Östra Mellansverige (SE) • Regional development plan has been • Life-science and biotechnology • There are several universities, e.g. Uppsala University, universities of Linköping, Örebro supplemented with a regional action plan for • Life science/biotechnology (biotechvalley.nu and Mälardalen and two hospital universities innovation (Regional handlingsplan för and Uppsala Bio innovation) • Automation (Robotdalen), • The action plan focuses on three areas, i.e. innovative environments, funding and creating • And food (an international competence center linkages for increased cooperation between around Grythyttan). academy, business and public sector • No sectoral priority is found in the policy discourse

Övre Norrland (SE) • ICT and biotechnology (berries). • Minerals - mining, • Luleå University of Technology, • Other competence areas have been identified in • Forestry • Umeå University the region, e.g. winter test driving, safety and • Energy • Umeå university hospital security, creative industries/tourism, environmental technology and e-health • Division of the Swedish University of Agricultural Science. • Akademi Norr

Pohjois-Suomi (FI) • Five centre of expertise clusters • High-tech manufacturing in the Oulu city-region • University of Oulu − ICT • Strong role of agriculture and forestry as well as • Oulu Innovation Ltd − Wellness tourism − Environmental technology − HealthBio − Nanotechnology and future materials

Pomorskie (PL) • No clear prioritisation • ICT • Pomeranian Science and Technology • Selection of clusters on the basis of competitive • Eco-energy • Gdańsk Science and Technology Park based process (e.g. ICT, Eco-energy and • Construction • Gdansk University of Technology Construction on 2015 Regional Programme)

Schleswig- Holstein (DE) • No clear prioritisation • Maritime economy • University of Kiel

Region/ Country Specialisation focus of research & Leading sectors/clusters Key scientific and research centres/ innovation policy infrastructures

• Natural prioritisation of maritime economy • Life science –Life Science Nord • IFM-GEOMAR • Food industry • Fraunhofer Institute Marine Biotechnology • ICT and new media - DiWish • Business Development and Technology Transfer • E-Health- medRegio Corporation of Schleswig-Holstein GmbH (WTSH) • Wind energy • Nanomaterials

• Focus is especially on improving the access to • Services (incl. public administration) • Roskilde University Sjælland (DK) capital for entrepreneurs (e.g. growth Driver for Mechanical Engineering Region Zealand) • • Special attention is given to cleantech and • Renewable energies (e.g. energy cluster Zealand) renewable energy • Transport and eco-mobility

Innovation in22 the Baltic Sea region

Region/ Country Specialisation focus of research & Leading sectors/clusters Key scientific and research centres/ innovation policy infrastructures

• The Regional Growth Programme prioritises five • Key sectors along the coastal areas and in the • Jönköping University Småland med öarna (SE) clusters: Furniture Empire (Möbelriket), islands are tourism and agriculture. • Gotland University Kingdom of Glass (Glasriket), Aluminum Empire • Several well established clusters in forestry and (Aluminiumriket), Heavy Vehicles (Tunga manufacturing industry, e.g. Aluminiumriket • Linneaus University. fordon) and Bioenergy Cluster Småland (mechanical engineering) and Tunga fordon (Bioenergikluster Småland) (automotive). • There are also two national research institutes, the Glass Research Institute (Glafo) and the • The regional development programme also • Newer clusters have been established in the points out prioritised regional strategies up to sectors of tourism and agriculture in the islands Swedish Casting Industry's Technology, Trade 2010: living environment and attractiveness; of Öland and Gotland. and Training Institute. communication; trade and industry; labour market and competence; and international co- operation

• Knowledge intensive sectors e.g. ICT, life • Eight VINN Excellence Centres have been Stockholm (SE) • National and regional R&I policy give priority to science, and financial services. established (six at the Royal Institute of strategic research areas in the fields of medicine, • Energy and Clean technology industries Technology, one at Stockholm University, and technology and climate one at Uppsala University. They are mainly into • Medical technology IT and Biotech) • In life sciences, two joint initiatives with Uppsala region exist, the first to develop a research centre • Several strong research universities, e.g. the Royal Institute of Technology, Karolinska (Science for Life Laboratory), the second to market the region (SULS) Institutet, Stockholm University, the Södertörn University, Stockholm School of Economics and a number of specialised university colleges

• Medical/ health care • University of Southern Denmark (notably ICT Syddanmark (DK) • Welfare-technologies & services (WellTech • Cleantech and biotechnology) and hosting a number of Region) national research centres • ICT and knowledge • Offshore industry • Odense University Hospital (Scandinavian’s • Specialised in construction and foods biggest and most modern hospital) • RoboCluster (robotics, automation and intelligent mechanical systems) • Technological development in companies: product development, technology and material development

Sydsverige (SE) • The action plan for innovation in Region Skåne • Key strengths are in life science, ICT and food, • Lund University and the Swedish University of

Region/ Country Specialisation focus of research & Leading sectors/clusters Key scientific and research centres/ innovation policy infrastructures addresses the need for creating new policy with 24% of Swedish agriculture and food Agricultural Sciences in Alnarp platforms for innovation processing. • Blekinge Institute of Technology, • Other areas of focus are in relation to • In Blekinge, there is a strong focus on ICT, with • Malmö University, entrepreneurship, development of new and the innovation systems/ cluster initiatives of existing businesses and innovative environments Telecom City and Netport.Pending • Kristianstad University • In Skåne, cluster initiatives are found in clean tech, moving media and risk & security.

Västsverige (SE) • Four areas receive special support: biomedicine • A main sector is automotive manufacturing • Several strong universities, e.g. Chalmers and health, smart textiles, environment, energy • Other key sectors prioritised in the regional University of Technology, Gothenburg University and sustainable transportation, and shipping and development plan are, e.g. biotechnology, and the university colleges of West, Borås, the maritime sector tourism, food processing, textiles, ICT, petro Skövde and Halmstad. • Regional platforms for interactive open chemical industry, environment/energy and • There are also Sahl-grenska University Hospital, innovation in prioritised areas maritime industries. six national research institutes and several • Regional triple helix partnerships are part of regional institutes. national R&D, innovation systems or cluster programmes, e.g. Smart textiles, Biomedicin i Väst and Hälsoteknikalliansen

Warminsko-Mazurskie • No clear prioritisation • Tourism • University of Warmia and Mazury (PL) • General support of cluster initiatives and • Furniture • Institute of Animal Reproduction and Food creation of science and technology parks on • Food sectors Research of Polish Academy of Sciences competitive-based process • ICT

Zachodniopomorskie • No clear prioritisation • Chemical industry “Green Chemistry” • The University of Szczeci (PL) • Selection of clusters on the basis of competitive • ICT • Zachodniopomorski Technological University based process • Koszalin University of Technology • General support of cluster initiatives and • Maritime University of Szczecin creation of science and technology parks on competitive-based process • Szczeciń Science and Technology Park Source: Regional briefs for this study, ERAWATCH and RIM database and reports. Compilation by authors.

Innovation in24 the Baltic Sea region

3. Innovation strategies and policies in the BSR

In order to build an overview of innovation strategies and policy measures round the Baltic Sea, information was compiled from the relevant EU level policy benchmarking databases: the joint ERAWATCH-InnoPolicy TrendChart (EW-TC) database for national policies and the Regional Innovation Monitor (RIM) database for regional policies. This first scan served as a foundation for the work of the study team who completed and validated the result of the mapping at national (for the three Baltic States) and regional levels through interviews and a review of documentation. A detailed list of the documents per country and region can be found in Appendix C.

3.1 Innovation policies and strategies in the BSR Figure 13 provides an overview of the number of identified innovation policy documents per country (including regional policy documents). The most recent key strategy documents are identified. As can be seen most of the Member States have in place a research or innovation policy strategy at national level; while in the two larger Member States, technology, innovation or regional innovation strategies have been drafted (although in some cases such as Pomorskie they are now relatively out of date). Figure 13: Summary of policy documents/strategies identified

# of policy Most recent main strategy document Country documents

• Regional Partnership agreement on growth and business development for each of the five regions (2007) Denmark 38 • Innovation Denmark 2007-2010 (updated 2008)

• Knowledge-Based Estonia. Estonian Research and Development and Estonia 8 Innovation Strategy 2007-2013

20 • Guidelines for technology policy Mecklenburg-West Pomerania (2009) Germany • Programme for the Future of the Economy - Schleswig-Holstein (2007)

Latvia 7 • Guidelines for Development of Science and Technology for 2009-2013

• 2010-2013 implementation plan of the Lithuanian innovation strategy Lithuania 30 2010-2020

22 • Regional Innovation Strategy in Westpomeranian Voivodship (2005, in process of being updated in 2010) • Regional Innovation Strategy of the Pomorskie region (2004) Poland • Project of the Regional Innovation Strategy of Warmia and Mazury (2010) • Research and innovation policy guidelines for 2011–2015 (2010) Finland 34 • Finland’s national innovation strategy (2008)

• A national strategy for regional competitiveness, entrepreneurship and Sweden 37 employment 2007-2013 (2007)

Total 196 Source: ERAWATCH-TrendChart and Regional Innovation Monitor databases, data extracted January 2011. Calculations by Technopolis Group The policy specialisation matrix in Figure 14 summarises the policy focus on specific technologies or clusters in the regional (or national) strategies.

Figure 14: specialisation focus of regional innovation strategies in the BSR

Source: Regional briefs for the study, ERAWATCH and Regional Innovation Monitor databases and reports. Compilation by Technopolis Group.

Innovation in26 the Baltic Sea region

As can be seen, the BSR innovation strategies, whilst covering a diverse range of fields and sectors, do converge around a number ‘specialisations’ notably: • ICT (17 regions); • Agro-food (including forestry) (11) • Healthcare/wellness (10) • Biotech (8) and life sciences (7). • ‘Cleantech’ (notably Denmark and Finland); • Energy (notably renewables) (with some probably overlap with cleantech field); • Materials (ranging from nanotech, through plasma to more traditional materials) A number of other priorities appear less often such as forestry, tourism/creative industries (although often linked to wellness or ICT/media respectively) and marine technologies despite their importance in the BSR economy. Despite such thematic or sectoral focusing of strategies, most interviewees argued that their region or country was not pursuing or, even, developing a ‘smart specialisation’ strategy. The exceptions were mainly in Sweden and to some extent Finland where national programmes such as VinnVäxt (Sweden) or the Centres of Expertise (Finland) have supported regional strategies or ‘bottom-up’ partnerships to develop more specialised policies. In Denmark, the regional growth programmes and cluster approaches also integrate some elements of specialisation into policy, which, however remains largely ‘nationally driven’, while being influenced at regional level by major companies (e.g. in food sector, wind turbines, etc.) and their supply chains. Case 2 Skåne Food Innovation Network (Skånes Livsmedelsakademi) Formed on the initiative of industry in 1994, the Skåne Food Innovation Network, works widely to develop the Swedish Food Industry, through increased innovation rate and value added. In addition, the network also tries to increase attractiveness among young, well educated people, to develop the sector and seeks to disseminate knowledge about the modern Skåne food culture, and how it can contribute to health, well-being and positive food experiences. Partners are 40 larger companies and organisations. They are not limited to the region, but also larger companies with parts of their business in the region. Members are around 35 smaller enterprises from across the entire value/supply chain. There is a board with representatives from companies, research and society, to reflect the width and strengths of the Skåne food industry. Funding includes partner and member fees, but also grants from national funding agencies; notably coming from VINNOVA. The network grew quickly into a well working network, with large commitment from industry, research and society. It has helped to successfully promote simultaneous involvement and commitment from industry, universities and organisations for business and/or user driven operation.

In all three Baltic States, specific technologies are mentioned in national strategies and, at least, in Estonia and Lithuania corresponding policy measures aim to support a focusing of effort (competence centres and national technology programmes in Estonia and ‘valleys’ and joint research programmes in Lithuania). Latvia has recently launched a ‘competence centre’ programme, however, the Latvian analysis suggests that the concept of smart specialisation is not yet on the policy agenda. A problem in all three Baltic countries is that the “focus” of policies remains rather defined by rather broad technology field and that implementation of the programmes does not always lead to the expected concentration of funds on specific fields. In two out of three Polish regions, the level of development of a focused innovation strategy appears to be weak, with ‘embryonic’ efforts to begin develop a more targeted regional policy. However, Pomorskie (see case) has a more developed policy with three strategic clusters selected after a competitive call (ICT, eco-energy and construction).

Case 3 The Pomorskie Voivodeship (Poland) – Support for Strategic Clusters In 2009, the Pomorskie voivodeship formally adopted the ‘Regional Cluster Programme: 2009- 2015’. Comparated to other Polish regions, this programme is unique because it only supports clusters which are evaluated as strategically important for the development of the voivodeship. More specifically, the programme foresees the support for three types of clusters, including: (1) strategic clusters, (2) sub-regional (local) clusters, and (3) embryonic clusters (technological networks). So far, three initiatives have obtained a status of strategic clusters: the Baltic Eco-Energy Cluster (BEEC), the Pomeranian ICT Cluster and the construction Cluster. The main benefits of obtaining a status of strategic cluster are three-fold. First, the cluster can receive support for the functioning and development of cluster. Second, preferences can be given to proposals submitted by those strategic clusters for certain support measures of the Regional Operational Programme and the regional component of Human Capital Operational Programme. The third benefit associated with the status of strategic cluster is that regional authorities can issue a recommendation that can be presented during the application for other public support programmes (e.g. EU Structural Fund interventions – National Operational Programmes, the Seventh Framework Programme, and the European Territorial Co-operation Programme). The most important lessons to be drawn from the case of the Pomorskie Voivodeship is that developing cluster programme is a long-term process, it involves a lot of efforts and many stakeholders. In order to succeed, establishing priorities is not enough. They key to success is to systematically monitor regional trends, in order not to loose sight of new emerging opportunities.

The two German regions present slightly different approaches with Mecklenburg- Vorpommern prioritising specific technology fields linked to major public research centres (e.g. plasma research) or the core competencies of regional universities (notably health economy) plus the BioCon Valley cluster. Schleswig Holstein has a more ‘bottom-up’ approach with policy being driven by two main clusters (Life Science Nord and the ‘maritime economy’. Via the interviews, the issue of the extent to which opportunities for synergies with other BSR were integrated into regional strategies was examined. In most cases, the current level of co-operation is limited to specific co-operation projects (funded via EU or eventually Nordic co-operation programmes), see section 5. Very few examples can be identified of regions specifically integrating an ‘external synergies’ analysis into their regional strategic planning process. Regions which reported links between their own strategies and Baltic Sea co-operation included Pomorskie, Mecklenburg- Vorpommern, Schleswig-Holstein. Other regions tended to report more bilateral/cross-border co-operation (e.g. Helsinki-Tallinn, Medicon Valley and other Öresund co-operation platforms).

3.2 Research and innovation measures Where policies are strategically focused, it would be logical to expect specific policy measures (programmes or initiatives) to focus on the same sectors. All relevant research and innovation measures (programmes) contained in the EW-TC and RIM databases for the BSR were mapped and cross-checked during the interviews with regional stakeholders. Appendix C presents the list of 306 national innovation policy measures and 96 regional ‘key’10 measures in the BSR. Equally, in larger (Federal) countries, the regional level is more important and so the total count of national and regional measures is more relevant. This explains the ‘ranking’ and the relative positions of Finland (with a relatively large number of specific programmes targeting sectors or technologies exist) versus Germany or Poland (broader programmes less targeted on specific sectors or technologies).

10 The RIM database should include, at a minimum, a description of the six main measures in each region. The three Baltic States are only monitored by ERAWATCH-TrendChart at the national level.

28 Innovation in the Baltic Sea

Equally, in larger (Federal) countries, the regional level is more important and so the total count of national and regional measures is more relevant. This explains the ‘ranking’ and the relative positions of Finland (with a relatively large number of specific programmes targeting sectors or technologies exist) versus Germany or Poland (broader programmes less targeted on specific sectors or technologies). Figure 15 and Figure 16 present respectively the split per country of the 306 national research and innovation measures identified and the policy prioritisation of the measures based on the categorisation used in the EW-TC database. Clearly only counting measures (n=306) does not take into account their financial importance in the national RTDI budgets. Second, the figures can be influenced by the extent to which national agencies work through a larger number of smaller programmes or a few major programmes. Equally, in larger (Federal) countries, the regional level is more important and so the total count of national and regional measures is more relevant. This explains the ‘ranking’ and the relative positions of Finland (with a relatively large number of specific programmes targeting sectors or technologies exist) versus Germany or Poland (broader programmes less targeted on specific sectors or technologies). Figure 15: National research & innovation measures in the BSR, number per country

22 Finland 59 29 Germany Sweden 31 Lithuania 48 Denmark

34 Poland Latvia 40 43 Estonia

Source: ERAWATCH-TrendChart database February 2011. Calculations Technopolis Group. Given the overall figures, Figure 16 gives an insight into the national policy objectives (or priorities) pursued round the Baltic Sea by the public authorities. The focus is on support for applied research and technologies and, in particular, on measures aimed on excellence in research in universities and public research centres (19%) and linkages between this ‘research base’ and the business sector (16%). Figure 16: Priorities of national innovation measures in the BSR EW-TC Policy categorisation priorities Frequency of priority in BSR (n=306 policy measures) 1. Governance & horizontal research and innovation 15% policies 1.1. Support to policy making (policy intelligence) 1% 1.2. Research and Innovation strategies 8% 1.3. Horizontal programmes/measures 6% 2. Research and Technologies 40% 2.1. Funding for universities and research organisations 19%

EW-TC Policy categorisation priorities Frequency of priority in BSR (n=306 policy measures) 2.2. Science and industry linkages 16% 2.3. State aid measures in support of business R&D 5% 3. Human Resources (education and skills) 8% 3.1. S&T education 3% 3.2. Research personnel 3% 3.3. Skills development and recruitment 2% 4. Enterprises 14% 4.1. Support to sectoral innovation programmes 3% 4.2 Support to entrepreneurial innovation 6% 4.3 Support to innovative start-ups and access to finance 5% 5. Markets and innovation culture 4% 5.1 Measures in support of innovation culture 2% 5.2 Support to the creation of new markets 0% 5.3 Intellectual property protection and standards 2% Source: ERAWATCH-TrendChart database, data extracted February 2011. Calculations by Technopolis Group. The percentages are the frequency with which each priority was selected as a first, second or third order priority for each measure.

Figure 17 explores the ‘thematic technological’ focus of the national research and innovation measures in the BSR. While almost 40% have no specific thematic focus (i.e. no targeting of specific technologies or sectors in the selection criteria of the project calls, etc.), a number of themes are clearly of higher priority in the BSR, namely: ICT; environment (including climate change); health; biotechnology, industrial production, energy, nanotechology and food, fish and agriculture. Figure 17: national research & innovation measures in BSR, thematic focus (n=306)

Source: ERAWATCH-TrendChart, February 2011. Calculations by Technopolis Group. Percentage calculated as frequencies (top 3) of the thematic priorities for each measure.

30 Innovation in the Baltic Sea

At the regional level, Figure 18 gives an overview of the 96 support measures contained in the RIM database as of mid-January 2011. There is some ‘imbalance’ in as over half of the 96 measures in the RIM database are from the Swedish regions.

Figure 18: Summary of support measures per Baltic Sea region

Denmark Number of SM Hovedstaden [DK01] 1 Sjælland [DK02] 1 Not covered Syddanmark [DK03] 1 Midtjylland [DK04] 1 Nordjylland [DK05] 1 Total 5 Country Number of SM Germany Number of SM Denmark 5 Sweden Number of SM SCHLESWIG- HOLSTEIN [DEF] 6 Sweden 53 Stockholm [SE11] 8 MECKLENBURG- VORPOMMERN Östra Mellansverige [DE8] 7 Finland 11 [SE12] 6 Småland med öarna Total 13 Estonia 0 [SE21] 5 Latvia 0 Sydsverige [SE22] 8 Lithuania 0 Västsverige [SE23] 6 Norra Mellansverige Poland Number of SM Germany 13 [SE31] 6 Mellersta Norrland Pomorskie [PL63] 6 Poland 14 [SE32] 7 Zachodniopomors kie [PL42] 5 Total 96 Övre Norrland [SE33] 7 Warminsko- Mazurskie [PL62] 3 Total 53 Total 14 Finland Number of SM SUOMI / FINLAND [FI] 2 Itä-Suomi [FI13] 2 Etelä-Suomi [FI18] 2 Länsi-Suomi [FI19] 4 Pohjois-Suomi [FI1A] 1 Total 11

Source: RIM database, data extracted January 2011. Calculations by Technopolis Group It is noticeable that there are relatively few measures in favour of research infrastructure or venture capita, this is probably due to such measures being managed by national agencies or financial institutions.

32 Innovation in the Baltic Sea

Figure 19: Policy priorities of regional innovation support measures in the BSR

RIM Policy categorisation priorities Priority 1 Priority 2 Priority 3 TOTAL # of SM # of SM # of SM 1. Governance & horizontal research and innovation policies 19 10 6 35 1.1.1. Strategy policy documents 0 1 1 2 1.2.1. Strategic Research policies 1 4 1 6 1.2.2. Innovation strategies 9 0 0 9 1.3.1. Cluster framework policies 4 2 4 10 1.3.2. Horizontal measures in support of financing 5 3 0 8 1.3.3 Other horizontal policies (ex. society-driven innovation) 0 0 0 0 2. Research and Technologies 43 19 7 69 2.1. Research organisations 1 0 0 1 2.1.1. Universities 1 0 0 1 2.1.2. Public Research Organisations 1 0 0 1 2.1.4. Research Infrastructures 3 0 0 3 2.2. Science-Industry linkages 0 0 1 1 2.2.1 Support infrastructure (transfer offices, training of support staff) 0 0 0 0 2.2.1. TT Support infrastructure 2 1 1 4 2.2.2. Knowledge Transfer 5 9 2 16 2.2.3. R&D cooperation 28 5 1 34 2.3.1. Direct support of business R&D (grants and loans) 2 4 2 8 3. Human Resources (education and skills) 1 2 2 5 3.1.1. Awareness creation and science education 0 0 1 1 3.1.3. Stimulation of PhDs 0 2 0 2 3.2.3. Mobility of researchers (e.g. brain-gain, transferability of rights) 0 0 1 1 3.3.1 Job training of researchers and other personnel involved in innovation 0 0 0 0 3.3.2. Recruitment of skilled personnel in enterprises 1 0 0 1 4. Enterprises 31 24 8 63 4.1.1. Support to sectoral innovation in manufacturing 4 4 1 9 4.1.2. Support to innovation in services 2 3 3 8 4.2. Support to entrepreneurial innovation 2 0 0 2 4.2.1. Support to innovation management and advisory services 7 2 1 10 4.2.2 Support to organisational innovation incl. e-business, new forms of work organisations, etc 0 0 0 0 4.2.3 Support to technology transfer between firms 0 8 1 9 4.3. Support to start-ups and access to finance 1 0 0 1 4.3.1. Support to innovative start ups incl Gazelles 14 3 2 19 4.3.2. Support risk capital 1 4 0 5

RIM Policy categorisation priorities Priority 1 Priority 2 Priority 3 TOTAL # of SM # of SM # of SM 5. Markets and innovation culture 1 2 1 4 5.1.1 Support to the creation of favourable innovation climate 0 0 0 0 5.1.2. Innovation prizes incl. design prizes 1 0 0 1 5.2.2. Support and guidelines on innovative Green Public Procurement (GPP) 0 1 0 1 5.3.1 Measures to raise awareness and provide general information on IPR 0 0 0 0 5.3.2 Consultancy and financial incentives to the use of IPR 0 1 0 1 5.3.3. Support to the innovative use of standards 0 0 1 1 Blanks 1 39 72 112

TOTAL 96 96 96 288 Source: RIM database, data extracted January 2011. Calculations by Technopolis Group

4. The contribution of the ERDF to Baltic Sea innovation policies

4.1 The ERDF contribution to national and regional innovation policies The importance of the Structural Funds, from varies both budgetary and strategic orientation perspective, varies for the BSR innovation policies. In Member States with regions eligible for support under the Convergence Objective (Estonia, Germany, Latvia, Lithuania, Poland) the share of the ERDF in total government expenditure on RTDI is considerably higher than in the eligible regions (Denmark, Germany, Finland and Sweden) for the Regional Competitiveness and Employment objective. Equally, in the large Member States account must be made for ‘multi-level governance’: regional policy measures and national (operational) programmes. The categorisation of Structural Fund expenditure by field of intervention (FOI) sheds light on the ‘intensity’ of RTDI expenditure in total ERDF allocations and on similarities and differences in strategic objectives across the BSR. The FOI codes are in line with the European Commission’s preferred selection of codes for RTDI. Figure 20 provides an overview of the total RTDI allocations per BSR, the relative importance of RTDI allocations in the SF programmes and the share of three broad groupings of FOI: ‘core RTDI’, ‘business innovation’ and ICT diffusion.

34 Innovation in the Baltic Sea

Figure 20: Structural Fund allocations for RTDI 2007-12 in the Baltic Sea regions Region Total allocations Core RTDI Business ICT Total RTDI Share of innovation diffusion RTDI/total ERDF Hovedstaden 188,938,233.91 34,288,429 11,893,901 10,426,009 56,608,339.06 30.0%

Sjælland 107,000,987 18,333,680 6,567,928 5,153,224 30,054,832 28.1% Syddanmark 140,598,023 27,428,631 8,093,307 8,122,024 43,643,962 31.0% Midtjylland 140,468,311 25,527,004 8,854,988 7,749,954 42,131,946 30.0% Nordjylland 66,644,017 12,111,074 4,201,175 3,676,901 19,989,150 30.0% Mecklenburg- 2,068,226,222 264,262,196 75,098,050 12,099,588 351,459,834 17.0% Vorpommern Schleswig-Holstein 613,191,592 103,186,524 14,862,184 15,318,563 133,367,271 21.7% Eesti 2,278,735,017 358,412,674 77,009,760 49,123,105 484,545,538 21.3% Latvija 3,072,730,695 419,153,858 335,850,767 100,518,398 855,523,023 27.8% Lietuva 4,537,620,994 447,517,453 233,095,675 133,179,777 813,792,905 17.9% Zachodniopomorskie 2,024,735,467 165,099,882 166,149,929 107,219,308 438,469,119 21.7%

Warmińsko- 2,357,860,786 175,304,707 187,822,699 119,561,232 482,688,638 20.5% Mazurskie Pomorskie 2,309,878,383 231,704,153 238,946,222 134,279,636 604,930,011 26.2% Itä-Suomi 551,238,293 112,843,171 60,082,057 56,800,480 229,725,709 41.7% Etelä-Suomi 422,398,626 53,849,093 14,576,545 30,638,594 99,064,233 23.5% Länsi-Suomi 302,772,813 49,585,128 23,073,135 20,377,496 93,035,759 30.7% Pohjois-Suomi 393,076,901 87,400,007 43,594,878 38,351,417 169,346,303 43.1% Stockholm 213,199,986 7,734,942 4,677,404 1,538,568 13,950,913 6.5% Östra Mellansverige 215,485,942 25,224,055 16,025,190 4,774,927 46,024,172 21.4%

Region Total allocations Core RTDI Business ICT Total RTDI Share of innovation diffusion RTDI/total ERDF Småland med öarna 134,800,093 15,673,243 6,145,700 8,032,864 29,851,808 22.1% Sydsverige 208,683,487 8,459,894 8,232,646 14,486,515 31,179,056 14.9% Västsverige 266,828,244 23,730,364 12,637,563 4,112,167 40,480,093 15.2% Norra Mellansverige 287,532,136 59,949,581 33,626,907 18,542,611 112,119,100 39.0% Mellersta Norrland 219,214,717.44 49,338,976 € 24,420,629 € 12,038,774 € 85,798,379.65 39.1%

Övre Norrland 303,616,026.54 66,429,157 € 47,096,311 € 22,303,997 € 135,829,464.79 44.7%

Source: Data from DG REGIO, calculations by Technopolis Group Core RTDI: 01_R&TD activities in research centres; 02_R&TD infrastructure and centres of competence; 03_Technology transfer and improvement of cooperation networks; 04_Assistance to R&TD, particularly in SMEs; 74_Developing human potential in the field of research and innovation; Business innovation: 07_Investment in firms directly linked to research & innovation; 09_Other measures to stimulate research and innovation and entrepreneurship. ICT diffusion: 11_Information and communication technologies; 12_Information and communication technologies (TEN-ICT); 13_Services and applications for citizens (e-health, e- government); 14_Services and applications for SMEs (e-commerce, education, etc.); 15_Other measures for improving access to and efficient use of ICTs by SMEs As can be seen from Figure 21, the share of SF RTDI allocations to the three broad types of RTDI intervention differs quite considerably across the 25 BSR. From a conceptual perspective, there would be an expectation that those countries that are least developed would invest a higher share of total RTDI expenditure in ICT diffusion (to encourage productivity catch up in enterprises and improved ICT skills in the general population through innovation in the form of embodied technology). This does not appear to be the case since the Convergence regions are spending a smaller share of their ERDF contribution on ICT diffusion.

36 Innovation in the Baltic Sea

Figure 21: Share of three broad types of RTDI allocation in total RTDI allocations per Baltic Sea region, 2007-13

T/<0#@.<<9451# >0990<234#@.<<9451# @.<<4#>099452/0099452/04PC<2=?0# M4AH.15?.G.;.<2=?0# L?03C/4# L43/?74# J02K# 6AH902I?DE-.9230?5# >0A=905BC?137:99451# 6:1145;4<=# 67899451# -./01234105#

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W.<0X#YZ[R#499.A4K.52# \C2?5022#?55./4K.5#499.A4K.52# RWZ#1?]C2?.5#

Source: Data from DG REGIO, calculations by Technopolis Group

Considering the data on ERDF allocation at the level of specific field of intervention (FOI), Figure 22 presents the share of each of the BSR for four FOI. Figure 22: Comparison of share of SF allocations 2007-13 per region for four FOI

01_R&TD activities in research centres

Pomorskie; 7% Eesti; 18%

Warmi!sko-Mazurskie; 4%

Zachodniopomorskie; 6%

Lietuva; 7%

Latvija; 37%

02_R&TD infrastructure and centres of competence

Mecklenburg-Vorpommern; 15%

Itä-Suomi; 7%

Schleswig-Holstein; 4% Pomorskie; 8%

Eesti; 11%

Warmi!sko-Mazurskie; 10%

Zachodniopomorskie; 7% Lietuva; 21%

38 Innovation in the Baltic Sea

07_Investment in firms directly linked to research & innovation

Eesti; 5%

Itä-Suomi; 5%

Latvija; 15%

Pomorskie; 21%

Lietuva; 9%

Zachodniopomorskie; 17% Warmi!sko-Mazurskie; 16%

74_Developing human potential in the field of research and innovation

Mecklenburg- Vorpommern; 9% Pomorskie; 7%

Warmi!sko-Mazurskie; 5%

Eesti; 16%

Zachodniopomorskie

Lietuva; 24% Latvija; 22%

Source: Data from DG REGIO, calculations by Technopolis Group • Developing human potential in the field of research and innovation − A total of €491.8m allocated or 9.0% of total SF RTDI allocations in the BSR − Once again, the three Baltic States (62% of the BSR region total) dominate the total allocation of funds for this key intervention aimed at support initiatives like doctoral schools, industrial PhDs, training of specialised scientific and technological staff, etc. Other regions accounting for a large share of the total ERDF allocation are the three Polish regions and Meckelnburg-Vorpommern. • RTDI activities in research centres − A total of €646m allocated or 11.9% of total SF RTDI allocations in the BSR; − Latvia (37%) and Estonia (18%) account for over half of the total BSR ERDF allocations for this FOI. No other single region comes close to the scale of expenditure invested by these two Member States. If Lithuania (7%) is added, then the three ‘Baltic States’ account for over 60% of SF expenditure targeted at research centres

• R&D infrastructure and centres of competence − A total of €736m allocated or 13.5% of total SF RTDI allocations in the BSR − Lithuania, with a significant investment in ‘Technology Valleys’ stands out in this FOI accounting for one fifth of planned expenditure; followed by Mecklenburg-Vorpommern, Estonia and Warmińsko-Mazurskie. Again these four regions in total account for over half (57%) of total planned SF allocations. • Investment in firms directly linked to innovation − A total of €957m allocated or 17.6% of total SF RTDI allocations in the BSR − In this case, the Polish regions Pomorskie (21%), Zachodniopomorskie (17%) and Warmińsko-Mazurskie (16%) allocated the lion’s share of the SF support for business innovation investments, followed by Latvia (15%). In total these four regions account for close to 70% of the total funding for this FOI. • Developing human potential in the field of research and innovation − A total of €491.8m allocated or 9.0% of total SF RTDI allocations in the BSR − Once again, the three Baltic States (62% of the BSR region total) dominate the total allocation of funds for this key intervention aimed at support initiatives like doctoral schools, industrial PhDs, training of specialised scientific and technological staff, etc. Other regions accounting for a large share of the total ERDF allocation are the three Polish regions and Meckelnburg-Vorpommern. While the relative concentration of investment in R&D infrastructure may enable the countries/regions concerned to invest in much needed development or upgrading, it does not lead directly or in the short-term to improved scientific and technological performance and specialisation (and even less directly to economic growth). This depends rather on the strategies and research management capacities of the centres receiving the investment. Equally, the regional level focus of the German and Polish regions ERDF programmes on business related investments appears to reflect in the first case the existence of complementary national programmes and research centres; while in the Polish case the business R&D potential is very limited and funding seems to be focused on ‘embodied technology transfer’ to raise productivity, etc. While the broad data on allocations does give an insight into the focus of funding efforts, more or less on the science push or business demand pull sides of the innovation system, a more in depth analysis of the actual expenditure through specific programmes is required to anticipate the potential final impacts on BSR innovation systems.

4.2 Assessing the contribution of the ERDF to smart specialisation strategies in the Baltic Sea region

4.2.1 The relative ERDF contribution to national and regional innovation policies The above analysis of ERDF allocation in favour of RTDI highlights that the ERDF contribution is significantly concentrated in 4-5 BSR regions. This absolute concentration of funds could lead to a significant ‘catching-up’ in terms of R&D infrastructure and human resources for S&T. This is notably the case in the three Baltic States, Mecklenburg-Vorpommern and to some extent the three Polish regions. However, it is important to put the ERDF contribution into the perspective of it’s importance with respect to overall national/regional budgets. Figure 23 provides data for the BSR regions on Structural Fund expenditure compared to business, government and higher education (BERD, GOVERD HERD) expenditure on R&D.

40 Innovation in the Baltic Sea

Figure 23: analysis of relative importance of ERDF in regional innovation systems

SF RTDI as % SF RTDI as % of regional SF Core RTDI Total R&D SF RTDI per Total RTDI in SF RTDI % SF RTDI % SF RTDI per SF Core RTDI GERD by region GOVERD of regional GOVERD+ as % of personnel R&D personnel Region (§) total SF per region year per year 2007 (!m)* (2007) HERD (2007) BERD (2007) GERD HERD regional GERD (FTE) 2007* per year Hovedstaden ! 56,608,339 30.0% 1.0% ! 8,086,906 ! 4,898,347 ! 4,305.571 ! 145.0 ! 735.7 ! 3,400.1 0.19% 0.92% 0.11% 31326 ! 258 Sjælland ! 30,054,832 28.1% 0.6% ! 4,293,547 ! 2,619,097 ! 296.548 ! 9.0 ! 138.8 ! 148.7 1.45% 2.90% 0.88% 2340 ! 1,835 Syddanmark ! 43,643,962 31.0% 0.8% ! 6,234,852 ! 3,918,376 ! 385.025 ! 4.0 ! 125.5 ! 255.6 1.62% 4.81% 1.02% 3628 ! 1,719 Midtjylland ! 42,131,946 30.0% 0.8% ! 6,018,849 ! 3,646,715 ! 852.790 ! 10.6 ! 369.0 ! 470.0 0.71% 1.59% 0.43% 7409 ! 812 Nordjylland ! 19,989,150 30.0% 0.4% ! 2,855,593 ! 1,730,153 ! 258.382 ! 21.5 ! 181.3 ! 55.6 1.11% 1.41% 0.67% 2190 ! 1,304 Mecklenburg-Vorpommern! 351,459,834 17.0% 6.5% ! 50,208,548 ! 37,751,742 ! 454.483 ! 188.0 ! 133.5 ! 133.0 11.05% 15.62% 8.31% 4633 ! 10,837 Schleswig-Holstein! 133,367,271 21.7% 2.4% ! 19,052,467 ! 14,740,932 ! 848.841 ! 220.2 ! 246.6 ! 382.0 2.24% 4.08% 1.74% 8022 ! 2,375 Eesti ! 484,545,538 21.3% 8.9% ! 69,220,791 ! 51,201,811 ! 173.648 ! 15.0 ! 72.6 ! 81.9 39.86% 79.02% 29.49% 5002 ! 13,839 Latvija ! 855,523,023 27.8% 15.7% ! 122,217,575 ! 59,879,123 ! 125.596 ! 30.5 ! 54.2 ! 40.9 97.31% 144.29% 47.68% 6378 ! 19,162 Lietuva ! 813,792,905 17.9% 14.9% ! 116,256,129 ! 63,931,065 ! 232.594 ! 48.5 ! 117.8 ! 66.4 49.98% 69.91% 27.49% 12656 ! 9,186 Zachodniopomorskie! 438,469,119 21.7% 8.1% ! 62,638,446 ! 23,585,697 ! 29.334 ! - ! 27.0 ! 1.2 213.54% 231.99% 80.40% 1952 ! 32,089 Warmi"sko-Mazurskie! 482,688,638 20.5% 8.9% ! 68,955,520 ! 25,043,530 ! 25.534 ! 8.2 ! 8.3 ! 9.0 270.05% 417.91% 98.08% 1182 ! 58,338 Pomorskie ! 604,930,011 26.2% 11.1% ! 86,418,573 ! 33,100,593 ! 90.087 ! 18.8 ! 29.0 ! 40.9 95.93% 180.79% 36.74% 4212 ! 20,517 Itä-Suomi ! 229,725,709 41.7% 4.2% ! 32,817,958 ! 16,120,453 ! 269.201 ! 35.4 ! 124.5 ! 109.3 12.19% 20.52% 5.99% 3590 ! 9,141 Etelä-Suomi ! 99,064,233 23.5% 1.8% ! 14,152,033 ! 7,692,728 ! 3,469.618 ! 414.8 ! 638.8 ! 2,416.0 0.41% 1.34% 0.22% 32558 ! 435 Länsi-Suomi ! 93,035,759 30.7% 1.7% ! 13,290,823 ! 7,083,590 ! 1,491.669 ! 59.0 ! 257.6 ! 1,175.1 0.89% 4.20% 0.47% 12173 ! 1,092 Pohjois-Suomi ! 169,346,303 43.1% 3.1% ! 24,192,329 ! 12,485,715 ! 1,010.429 ! 54.7 ! 143.7 ! 812.0 2.39% 12.19% 1.24% 7892 ! 3,065 Stockholm ! 13,950,913 6.5% 0.3% ! 1,992,988 ! 1,104,992 ! 3,933.579 ! 237.7 ! 755.3 ! 2,936.6 0.05% 0.20% 0.03% 25239 ! 79 Östra Mellansverige! 46,024,172 21.4% 0.8% ! 6,574,882 ! 3,603,436 ! 1,814.143 ! 151.9 ! 580.9 ! 1,080.7 0.36% 0.90% 0.20% 11810 ! 557 Småland med öarna! 29,851,808 22.1% 0.5% ! 4,264,544 ! 2,239,035 ! 297.510 ! 7.5 ! 51.1 ! 238.7 1.43% 7.28% 0.75% 2299 ! 1,855 Sydsverige ! 31,179,056 14.9% 0.6% ! 4,454,151 ! 1,208,556 ! 2,143.112 ! 34.8 ! 399.6 ! 1,707.3 0.21% 1.03% 0.06% 12150 ! 367 Västsverige ! 40,480,093 15.2% 0.7% ! 5,782,870 ! 3,390,052 ! 2,409.163 ! 75.1 ! 427.0 ! 2,373.9 0.24% 1.15% 0.14% 16166 ! 358 Norra Mellansverige! 112,119,100 39.0% 2.1% ! 16,017,014 ! 8,564,226 ! 335.023 ! 23.9 ! 45.8 ! 265.1 4.78% 22.98% 2.56% 2752 ! 5,820 Mellersta Norrland! 85,798,380 39.1% 1.6% ! 12,256,911 ! 7,048,425 ! 90.187 ! 6.2 ! 26.9 ! 57.1 13.59% 37.03% 7.82% 722 ! 16,976 Övre Norrland ! 135,829,465 44.7% 2.5% ! 19,404,209 ! 9,489,880 ! 438.482 ! 36.6 ! 256.1 ! 145.7 4.43% 6.63% 2.16% 3196 ! 6,071 Total BSR ! 5,443,609,559 23.2% 100.0% ! 777,658,508 ! 406,078,268 ! 25,781 ! 1,856.9 ! 5,946.6 ! 18,402.8 3.02% 9.97% 1.58% 221477 ! 3,511 § Source: data from DG REGIO, Structural Fund allocations for the 2007-13 period, calculations Technopolis Group * Source = Eurostat, data extracted 1 April 2011

Figure 24 presents graphically the BERD, HERD and GOVERD data compared to Structural Fund expenditure on the ‘core RTDI’ category. This is not comparing exactly ‘like-for-like’ but it represents a proxy for the importance of Structural Fund RTDI expenditure compared to the ‘regional innovation systems’ current capacity. As can be seen in most Nordic regions the contribution is minor but in the Baltic States and Poland the share climbs rapidly toward 50% and even close to 100% in one extreme case. Figure 24:estimated contribution of Structural Funds to regional R&D funding

100%

90%

80%

70%

60%

50%

BERD (2007) 40% HERD (2007) 30% GOVERD (2007) SF Core RTDI as % of regional GERD 20%

10%

Eesti LatvijaLietuva Sjælland PomorskieItä-Suomi Stockholm Sydsverige MidtjyllandNordjylland Västsverige HovedstadenSyddanmark Etelä-SuomiLänsi-Suomi sko-Mazurskie Pohjois-Suomi Övre Norrland ! Schleswig-Holstein Östra Mellansverige Mellersta Norrland Zachodniopomorskie Småland med öarnaNorra Mellansverige Warmi

Mecklenburg-Vorpommern

Source: Eurostat for R&D expenditure, DG REGIO for ERDF funding Such a relatively important share of ERDF funding in the ‘innovation systems’ suggests that there is an issue about the capacity for ‘absorption’ of the funding in the Baltic States and Poland. In particular, there are only a limited number of ‘operators’ in these national and regional systems able to develop projects and the capacities and capabilities of ministries and agencies are often stretched on the policy design and management side. Indeed, spending data from annual implementation reports, evaluation evidence and interviewee feedbacks suggests that the systems are unable to cope in a ‘sophisticated’ enough way in order to focus and prioritise funding, notably on research infrastructure. Figure 25: per capita contribution of SF to regional RTDI compared to per capita gross expenditure on RTDI

SF RTDI per capita GERD per capita annual average Region (2007) 2007-13 Hovedstaden 2631 4.9 Stockholm 2051 1.0 Sydsverige 1604 3.3 Pohjois-Suomi 1588 37.9 Etelä-Suomi 1327 5.4 Västsverige 1319 3.2 Östra Mellansverige 1190 4.3 Länsi-Suomi 1114 9.9 Övre Norrland 861 38.1 Midtjylland 695 4.9 Nordjylland 448 4.9

42 Innovation in the Baltic Sea

SF RTDI per capita GERD per capita annual average Region (2007) 2007-13 Itä-Suomi 407 49.8 Norra Mellansverige 406 19.4 Småland med öarna 371 5.3 Sjælland 363 5.2 Syddanmark 324 5.2 Schleswig-Holstein 300 6.7 Mecklenburg-Vorpommern 268 29.8 Mellersta Norrland 243 33.0 Eesti 129 51.6 Lithuania 69 34.4 Latvia 55 53.7 Pomorskie 41 39.2 Warminsko-Mazurskie 18 48.3 Zachodniopomorskie 17 37.0 Source: Eurostat and DG REGIO (ERDF data), calculations Technopolis Group At the same time, as illustrated in Figure 25, even with the volume of ERDF funds allocated to the BSR ‘convergence regions’, the Structural Fund intervention will at best marginally ‘close the ‘innovation gap’ between the Nordic ‘rim’ and the ‘south- Eastern coast’ of the BSR during 2007-13.

4.2.2 The ERDF as a complement to national and European research infrastructure strategies The development of research infrastructure and capacities in fields where a country or region has a specific scientific, technological or business specialisation or in areas of research related to societal needs is one element of a broader response to achieving what is now termed a ‘smart specialisation’ strategy. At European level, the ESFRI Roadmap identifies new Research Infrastructure (RI) of pan-European interest corresponding to the long-term needs of the European research communities, covering all scientific areas, regardless of possible location. Aside from the approval of 44 ESFRI centres, the aim is to encourage national and regional stakeholders to set-up parts of distributed infrastructures or Regional Partner Facilities partner centres. In this context, as can be seen from Figure 26, national research infrastructure plans exist in Denmark, Estonia, Finland and Sweden. Figure 26 : BSR Research Infrastructure plans and ERDF support

National Large National Public Importance of ERDF co- Research Research funding reserved finance for research Infrastructure Infrastructures for new RIs infrastructures Strategy (ESFRI)

Denmark Future research Yes Yes • Minor, complement at infrastructures – regional level to national needs survey and initiatives strategy proposa (2005)l

Estonia Estonian Research No Yes • Major. 2007-13 Research Infrastructures Infrastructure measures. Roadmap (2010) Finland National-Level Yes Yes • Minor, complement at Research regional level to national Infrastructures: initiatives Present State and Roadmap (2009

National Large National Public Importance of ERDF co- Research Research funding reserved finance for research Infrastructure Infrastructures for new RIs infrastructures Strategy (ESFRI)

Germany No Yes Yes • Minor, complement at regional level to national initiatives.

Latvia No No No • Major. SF co-funded programmes for development and upgrading of RI.

Lithuania Being prepared None Yes • Major. Valleys and Joint- Research Programmes (2007- 13).

Poland No Yes Yes • Major, at national level about a €1b from OP Innovative Economy invested in RI.

Sweden Swedish Research Yes Yes • Minor, complement at Council’s guide to regional level to national Infrastructure initiatives (2007) Source: ESFRI roadmap implementation report 2009. EW Country Reports 2010. At national and regional levels, in Germany and Poland there are no RI road maps but specific investments at public or higher education research are supported through national funds and/or regional (ERDF co-financed) programmes. The Structural Funds have contributed to a renewal of Estonia’s research infrastructure since 2004-2006 (a first limited programme with about €14m allocated) but a significant expansion of funding has occurred during 2007-13 with both the continuation of the Centres of Excellence Programme, seven new centres were approved (including some, but not all, of the former 10 centres) with funding for seven years €45m; and the R&D Infrastructure development Programme with funding for modernisation of higher education research buildings and equipment (€101m). Although Estonia has a national research infrastructure road map, it was developed and adopted after the main decisions on the use of the 2007-13 Structural Fund support for research infrastructure. The plan seeks to outline both the main Estonian research infrastructures and Estonia’s contribution to ESFRI. The plan does not set out estimated investment needs for the research infrastructures identified. In neighbouring, Latvia and Lithuania no such road map has yet been developed. In Latvia, where a relatively small amount of funds were earmarked under the research infrastructure FOI code, investment is foreseen nevertheless under the research centres FOI code to improve research infrastructure in the main research centres and support the creation of six competence centres and the implementation of their research projects in the following fields: ICT, wood processing, chemistry, electronics, machine building, and biotechnology. In Lithuania, the Business-Research Valleys and Joint-Research Programmes (co- funded by the ERDF during 2007-13) serve to prioritise to some extent research infrastructure plans. Investments in research infrastructure or new R&D centres in Lithuania are linked to the priority technology fields (see case below for more details). Similarly, in the three Polish regions, interviewees noted that “the ERDF is a key if not the only source of funding” for research infrastructures. However, interviewees suggested that investments in public R&D infrastructure were often made with considering the existing infrastructure in other regions. This raises the issue of difficulties of finding clients to use the infrastructure in the future and hence a risk of non-sustainability of the ERDF investment. In the two German regions, investment in research infrastructure accounts for between one quarter (Schleswig-Holstein) and one third (M-P) of Structural Fund

44 Innovation in the Baltic Sea

allocations for 2007-13. The ERDF supports a range of projects and infrastructures (e.g. the maritime cluster). Interviewees noted that the regional universities have benefited from investment in competence centres, which aimed to better link science and industry and market the results. In Denmark, Finland and Sweden, ERDF funding is largely complementary to the main national funding streams. This is clearly the case for research infrastructures and centre, with the major infrastructure and centres mentioned in national road- maps being funded through national funding programmes. EU funds, including FP7, EIB and the ERDF, therefore play a role as catalysts or complements to national priorities. Sweden has a long tradition in building, maintaining and operation research infrastructures and has one of the most advanced and developed infrastructures in several fields. Investment in research infrastructure is a key area of focus of the Swedish research and innovation funding bodies. However, there appears to be clear division of labour with the ERDF focusing more on ‘soft’ interventions such as clustering, etc. as during the 2007-13 period only around 10% of Structural Fund RTDI appropriations (€48m) are allocated to R&TD infrastructure and centres of competence. In Denmark, the share of funding allocated to research infrastructure is a bit higher, at about 14% of ERDF RTDI spend but in absolute terms this amounts only to €26m. The ERDF programme for 2007-13 focuses more on business innovation foreseeing for instance establishing centres of competence to strengthen regional innovation capacity within specific industries or technologies. Similarly, in Finland, ERDF funding for research infrastructure accounts for about 13% (or €88m) of total ERDF allocations to RTDI. Nevertheless, a key focus area of the ERDF programme is the promotion of competence and innovation, and the strengthening of the related structures and centres of expertise. Around €92m was earmarked annually for these objectives from the ERDF and central government funds. According to interviewees, the lessons of ‘early programming’ in convergence regions (such as Mecklenburg-Vorpommern) suggest that a ‘first class’ infrastructure can be built with ERDF support but that there is a need to focus earlier on building up competitive R&D activities and teams. In particular, there is a need to align infrastructure investments closer with industrial demand driven needs and develop ‘open access’ operating principles. Case 4 provides an example of how attempts to build research infrastructure linked to business R&D and innovation needs can be complex in countries where there is limited prior experience of such co-operation (particularly raising issues around ‘business models’ and ‘open access’ rights). Case 4 Lithuania – Integrated centres of science, studies and business (“Valleys”) In November 2008, the Government of the Republic of Lithuania adopted a resolution on the establishment of integrated centres of science, studies and business (“Valleys”). The Ministry of Education and Science and the Ministry of Economy allocated €400m for the implementation of the Valleys programme with funding from the EU Structural Funds programme for 2007-2013. The programme is implemented through three components: valleys, joint research programmes (JRPs) and individual projects. Five valleys, concentrating on the potential of scientific research, studies and knowledge intensive business in specific geographical areas, and four JRP with a focus on selected sectors have been launched. Moreover, there are 20 R&D infrastructure development projects under the four JRPs within five Valleys, which include a mix of open access research centres, studies centres, science and technology parks, business incubators, etc. At the moment there are a number of key issues that still need to be resolved. Despite the shared will for cooperation among the HEIs, PRIs, local governments and business, in most cases there is still a natural tendency to satisfy the needs and interests of specific HEIs or PRIs and not to consider the wider innovation system. There is also a lack of cooperation experience of Lithuanian science and research institutions, local governments and businesses, as well as the absence or limited participation of foreign companies. Finally, the programme does not contain elements of cooperation with partners from outside Lithuania. However, it is acknowledged that partners should look outside Lithuania in the future and linkages with BSR initiatives exist.

Evidence on impact of ERDF funding on BSR innovation performance According to the majority of interviewees and documentary evidence reviewed, it is still too early to observe a significant impact of the Structural Funds in Estonia, Latvia, Lithuania and the Polish regions. In Latvia and Lithuania, interviewees commented that ‘implementation is rather slow’ while in Poland the current efforts are concentrated on consumption of funds. In order to cross-check this information, an analysis of the funding committed was undertaken for ERDF funding programmes on the basis of the Annual Implementation Reports (AIR) of the Member States to the European Commission for the period 2007-2009. The ratio of the RTDI commitments for the period 2007-200911 and the total allocation for the period 2007-2013 provide an indication of the financial absorption capacity of the BSR regions. From the data, it is observable that there are significant disparities in the absorption capacity of the RTDI measures co-financed by ERDF per region12. Results range from a very low value for Zachodniopomorskie (close to 10%) to the extremely high percentage of absorption found in Schleswig-Holstein (around 90%). On average, the two German regions are the best performing regions in terms of RTDI already committed. The three Baltic States and all Danish regions present a satisfactory rate (around 50%) of absorption capacity. A less satisfactory outcome is found in Poland, notably in Zachodniopomorskie and Warmińsko-Mazurskie.

Figure 27: Ratio ERDF allocations 2007-2012 and rate of expenditure

100% 88% 90% 80% 62% 62% 70% 58% 52% 54% 60% 46% 51% 51% 48% 42% 42% 38% 38% 50% 32% 40% 27% 23% 28% 28% 30% 20% 11% 10% 10% 00%

Source: Annual Implementation Reports 2007, 2008, 2009. Calculations: Technopolis Group. The conclusion it is still often too early to draw firm conclusions on effects of the 2007-13 period are corroborated by the 2010 policy papers on innovation produced by DG REGIO’s expert evaluation network (delivering policy analysis on the performance of cohesion policy 2007-2013). The policy papers for the BSR countries found that there is no substantial evidence of impact on innovation peformance (Lithuania)13,

11 The codes use for this calculation are the same codes previously used in figure 18 on Structural Fund allocations for RTDI 2007-12 in the Baltic Sea regions 12 The AIR data is not fully complete and comparable with the data on allocations nor does it give a true indication of actual expenditure levels which may be more telling than commitments for certain major projects (e.g. research infrastructure). 13 See also the presentation Cohesion Policy Support to Innovation in Lithuania: Lessons Learnt for Evaluation, available at: http://ec.europa.eu/regional_policy/sources/docgener/evaluation/doc/14042011/3c_paliokaite_innovati on_lt_regio.ppt

46 Innovation in the Baltic Sea

implementation problems had arisen due to the absence of co-financing (Latvia), while in Poland, the overall impact of investment in science and technology parks was limited while the best results were reported for projects strengthening co-operation between the research sector and businesses. The Latvia report even argued that as “Many activities (of the 2004-6 period) had a late rush of implementation in 2007 and 2008 (e.g. the ERDF venture capital programme), so meaningful evidence on performance cannot be expected for some time”. A similar conclusion seems to have been reached by an initial assessment of the effects of enterprise measures in Estonia, which found little evidence of significant impact by 2010 (see Case 5). Case 5 : Assessing the impact of the ERDF on enterprise and innovation in Estonia The Estonian State Audit Office (SAO) undertook in 2009-10 a study into the ‘Impact of the State Enterprise Policy on Estonian Competitiveness’. The study involved an analysis of 57 different measures implemented by Enterprise Estonia and KredEx during the period 2004-9 and which disbursed 7.4 billion crowns (approximately €474m), divided into seven groups for the purpose of analysis. For each group, the SAO agreed with the Ministry of Economic Affairs and the two agencies the expected impact the support should have had on the behaviour and the economic trends of the enterprise (for example, export growth). A questionnaire was sent to a sample of 4,262 enterprises, out of which 1,881 enterprises responded: 954 enterprises had received support, 180 enterprises had applied for but did not receive support, 747 enterprises, which had never applied for support, were used as a control group. In the questionnaire, supported enterprises were asked to assess the impact of the support received on their economic activity. The SAO compared the survey responses with the real economic indices of the enterprises who had received support, and of the control group, the indices in the fields of activities and the economy of Estonia as a whole. Based on the questionnaire and the additional desk research and interviews, the SAO came to the conclusion that the support measures had not yet “improved the competitiveness of the audited fields of activity”. In particular, it argued that the low productivity and the limited export capacity of Estonian enterprises have not significantly increased as a result of enterprise policy measures. The main reason put forward by the SAO for this limited impact “was a rigid, untargeted and dispersed system of supports which tries to deal at the same time with many problems of entrepreneurship and very often does not consider the actual needs of enterprises”. Source: Impact of state’s enterprise support on the competitiveness of the Estonian economy. Available at: http://www.riigikontroll.ee More positively, a mid-term review of the Estonian Competence Centres programme (five business-research consortia working in a number of targeted technology fields and largely funded by the ERDF)14 identified early signs of impact. Positive effects included that three of the centres had managed to increase significantly their industrial income above expectations, thus a significant success. The CCs also served to focus research attention and effort on specific areas of technology and thereby to increase the number of PhD students working in the given areas. There was an important and useful knock-on effect to MSc and BSc education, providing human resources to strengthen both the university and the industrial systems. Equally, in Poland, and while not specific to the three Polish BSR regions, an evaluation of the Polish innovation vouchers programme (2008-10), launched by the Polish Agency for Enterprise Development (PAED) as a pilot project in 2008 found that approx. 41%) continued cooperation with scientific units after completion of the service financed under the Innovation Voucher15. Indeed, 58% of beneficiaries considered there had been a positive impact from their participation in the programme Both these examples, tend to suggest that correctly designed policy

14 Available at: http://www.mkm.ee/failid/IS12_competence_center_programme_2008.pdf 15 See: http://ec.europa.eu/regional_policy/sources/docgener/evaluation/doc/14042011/3b_innovation_vouche r_paed.docx

measures can foster increased business-research co-operation, a weakness of the innovation systems in the south-east rim of the BSR. Moreover, even in the more advanced Nordic countries, where policies have been in place for several decades, assessing the impact of innovation policies is complex. In Finland, see Case 6, a 2009 evaluation of the Finnish innovation system included a specific analysis of regional support for innovation and investment and concluded that the effects of public intervention were not unambiguously positive. Case 6: Systems evaluation of the Finnish Innovation System In 2009, a team of international and Finnish experts conducted an evaluation of the Finnish innovation system. The study analysed six cross-cutting themes: broad-based innovation policy; demand- and user-driven innovation; globalisation of business activities; growth entrepreneurship and finance; geography of innovative activity; education, research and the economy. The evaluation involved more than 10 supporting studies, over a 100 interview/hearings, 2000 survey responses, qualitative and quantitative hearings. In overall terms, the evaluation concluded that while Finland currently has one of the best national innovation systems worldwide; even that may not be enough in an era, where the global operating environment is rapidly evolving and the whole concept of a national innovation system has been questioned. Companies have been the primary target of innovation policy but, as they become increasingly footloose and geographically dispersed, the focus may have to shift to nurturing and attracting creative individuals. The study on the ‘geography of innovative activity’ is of most relevance for learning from a Structural Fund perspective. Based on a ‘triangulation of methods’ (analysis of patterns of regional support for innovation and investment, including ERDF, regional productivity trends including ‘new entrants’, and a counter-factual analysis using a panel of enterprises), the study argued that the ”unspoken regional bias in national innovation policy (including the use of Structural Funds to support firms in ‘disadvantaged regions’) is contributing to the misallocation of resources that drives the recent divergence in competitiveness between Finnish regions”. The authors conclude that running innovation policy and competition policy with a regional agenda may come at a high cost in terms of foregone growth at both the local and the national level. Hence, innovation policy should celebrate firms that endeavour to move the current technology frontier forward no matter where they are actually located, even when they happen to locate in ‘advantaged’ regions. Sourc: Veugelers R. et al (2009) Report of the evaluation panel of the Finnish National Innovation System. Available at : www.evaluation.fi Nevertheless, although the relative contribution of the Structural Funds is small compared to national funds in the Nordic countries the ERDF funding is often used to leverage additional funding from public-private partnerships. Nordic interviewees, for this study, stressed that the ERDF was a ‘ground-breaker’, ‘fundamental and necessary in early phase of new developments’. An example is the Robotdalen project. Case 7: Robotdalen (Sweden) In 2003, Robotdalen was set up as an initiative with the vision to take the lead in research, development and manufacture of industrial field and medical robotics. Activities are solely following from the fact that Robotdalen is a robotics initiative enabling commercial success of new ideas and research within robotics and automation, focusing mainly on solutions for the industry, heavy vehicles and health care sector. Robotdalen is funded by VINNOVA, the European Regional Development Fund, the European Social Fund and a number of public institutions, universities and companies in Central Sweden. Funding from the European structural funds amount to 25% of the funding for some years, thus making it significant in leveraging the development of the project. Matching of European and national agency funding with local funding seems to have built in necessary local commitment and engagement, which serves to warrant that individual initiatives are well grounded in local reality. So far 17 companies and 17 products have been achieved. There is strong political support by counties and the initiative has been, overall, effective in strengthening awareness of Robotdalen in Sweden. Moreover, the cluster project has been successful in mobilising stakeholders from the entire region, including major companies such as ABB, Atlas Copco and Volvo. One of the keys to its success has been an environment in which actors in the fields of advanced research;

48 Innovation in the Baltic Sea

higher education and industry have collaborated, with encouragement of innovations and new enterprises.

In conclusion, it appears too early to draw firm conclusions on the impact of ERDF support to the BSR regions in terms of ‘levelling the playing field’ of R&D infrastructure and capabilities or in terms of generating major shifts in business innovation performance. However, the experience of the Nordic countries, notably Sweden and Finland, does underline that the ERDF has played a role in fostering strong ‘triple helix’ partnerships supporting the renewal of existing, or newly emerging, industrial sectors can be beneficial. The evidence on higher education and public research infrastructure investments in the ‘new Member States’ of the BSR suggests that not enough has been done to transfer know-how and experience from the more advanced regions in the design and management of such facilities. Nor is there any perceptible effort to pool research resources or to do a prior ‘reality check’ on whether it could be more cost effective to buy time for regional researchers on existing research infrastructure/equipment in neighbouring regions.

5. Mapping of national and regional organisations and stakeholders

Following the assessment of innovation strategies and policies around the BSR, this section focuses on identifying who is behind the design and delivery of these in the EU Member States in the BSR. In order to provide the most accurate and sensible information on both, who is doing what and where within the Baltic Sea Region, the work has been divided in two major phases.

5.1 An institutionally ‘rich’ macro-region In a first instance, the organisational mapping exercise has been carried out by a search of the RIM16 and ERAWATCH databases. Thanks to these monitoring platforms, an up-to-date list of all major institutional policy actors and intermediaries engaged in the development, implementation and review of research and innovation policies at national and regional level was obtained. During this stage, the identified number of organisation (198) was clearly only preliminary and needed to be further refined and developed. This was especially true for the case of the Baltic regions where the list of organisations was not reflecting a minimum set of key actors, notably of research centres, clusters and research infrastructures. Therefore, the 198 identified organisations broken down by country and region were then provided to national experts who were asked to check and complete the identification of the key players in charge of delivering innovation and research activities in their specific countries and regions. National experts completed the list based on desk research as well as with additional input obtained during the interviews with key stakeholders in the countries and regions across the BSR. Regional government departments responsible for STI or industrial policy; regional development or innovation agencies, science and technology parks or centres, key cluster or organisations and venture/seed capital funds were added during this phase of the work. Finally, approximately 500 organisations involved in innovation and research activities in the BSR were identified. National experts completed a minimum information per organisation such as the mission statement, main activities, website, type of organisation and involvement in BSR co-operation. This information has been used for the subsequently analysis. As can be seen in Figure 28, the organisational mapping has identified a total of 490 key organisations. The number of organisations listed varies from 32 organisations in Latvia to 130 in Sweden, with an average of 60 organisations per country. The disparities found at national level, are less noticeable when the list is broken down regionally. Except for the three Baltic States (Estonia, Lithuania and Latvia) where there is no breakdown due to the fact that regional level is not essential from a ‘governance’ perspective, experts have, on average, detected 16 organisations playing a key role in developing and implementing innovation policies per region. An exhaustive list of organisations per country and regions is provided in Appendix C.

16 RIM covers 20 EU Member States including Denmark, Finland, Germany, Poland and Sweden. However, RIM does not cover Member States with only local governments, as Estonia, Latvia and Lithuania.

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Figure 28: Baltic Sea research & innovation organisations per country Country Number of organisations Denmark [DK] 67 Estonia [EE] 33 Germany [DE] 45 Latvia [LV] 32 Lithuania [LT] 57 Poland [PL] 64 Suomi/Finland 62 [FI] Sweden [SE] 130 Total 490 Source: ERAWATCH, RIM databases and experts’ input. Calculations by Technopolis Group. In terms of the number of organisations identified, science and technology parks (17%), public research organisations (16%), higher education institutions (13%), followed by national governments (12%), clusters (11%) and finally regional agencies (8%) have been identified as essential actors in the innovation and research policy systems in the Baltic Sea Region. These results underline the important role of public authorities such as national ministries, agencies and public research organisations but also the existence of a potential for ‘triple-helix’ type co-operation (public-private-academic) in the innovation landscape of the Baltic Sea Region. In a large majority of cases, we see how relevant stakeholder groups are involved in the policy formation process. However, the degree of involvement varies considerably between countries, ranging from a greater role of public sector and academic sector in Polish regions, industrial sectors in Denmark to an authentic triple helix model in Sweden. Figure 29 BSR research & innovation stakeholders and organisations by type

Private research Higher Education organsitation/ 13% National Cluster institute 1% Government Science and 11% 10% Technology parks 17% National Agency 4%

Non-profit research organisation Regional Other 4% government 6% 6% Private venture/ Regional agency Public research seed capital 8% Public venture/ organisation/ 2% seed capital institute 2% 16%

Source: ERAWATCH, RIM databases and experts’ input. Calculations by Technopolis Group To this extent, 61 higher education centres and science and technology parks have been highlighted as important partners in innovation projects and crucial actors in knowledge creation and transfer in the regions. It is worth noting how all experts have equally given special attention to higher education institutions, mentioning on average two to three universities per region or country for the case of the Baltic States. Sweden is the country where the education system has been perceived as most

important in terms of total number of universities mentioned (14 universities have been mentioned, representing a 23% of all collected universities). Poland and Germany, with 10 and 9 universities respectively, gets marked significantly above. On the other hand, Latvia and Estonia with only two and four universities respectively being outlined, clearly illustrate the difficulty in achieving a satisfactory enrolment level of the higher education system in these Baltic States. Another important finding in relation to the higher education institutions is the higher number of these, which are involved in cross-border initiatives within the Baltic Sea Region. More than half of the higher and tertiary education centres (55% compared to an average of 35% for all organisations) work together with neighbouring centres in specific educational and research opportunities within the region. The aim is to maintain a strong human capital base by strengthening knowledge flows between the BS region countries. This picture is to some extent different for science and technology parks. Science parks do not seem to be homogeneously represented and supported in all BSR countries and regions. The bulk of science parks, over 35%, are located in Swedish regions; followed by Finland and Lithuania (22% and 16% respectively of the total). Local governments in Germany and Latvia, with one and two science parks respectively, seem to promote less this type of projects. Case 8: Uppsala Innovation Centre (UIC) UIC is a part of the Swedish national incubator program (IBIP) run by Innovationsbron. As business incubator for growth companies in the Uppsala region, UIC is supporting start-up companies that want to develop new ideas to become strong growth companies. Since 1999 it fundamentally provides management and financial assistance as well as access to commercial and technological networks. Around 140 companies have been part of the incubator programmes and a network of around 50 business coaches has been established. UIC offers today four different incubator programmes, with a sum of 65 participating companies; UIC Business Start (39 participants), UIC Business Lab (43), UIC Business Accelerator (22) and UIC Alumni (24), all of which have been completely funded by partners (Innovationsbron has the largest part). UIC itself points to a number of key success factors, the most important are: 1) the range of programmes, 2) the business coach model, 3) UIC has no ownership in the incubator companies, 4) focus is on business development, not on letting out premises, 5) clear and reciprocal demands between UIC and companies, 6) continuous, monthly reports from business coaches, 7) the companies appreciate the efforts and are willing to pay for them, and 8) strong co-operation between actors in the innovation system.

As exceptional mention has been also given to clusters. Only in Sweden and Denmark a total of 40 clusters (out of the 53 clusters identified in the BSR) have been identified. A similar case is found in the Pomorskie and Warminsko-Mazurskie regions where a total of 10 clusters have been identified in a wide range of sectors. From the Space sector (e.g. Latvian Space Technology Cluster), fibber Optic (e.g. Fiber Optic Valley in Norra Mellansveige, Sweden) to agriculture and food industry (e.g. Agro Food Park in Midtjylland, Denmark) the function of clusters in delivering and implementing innovation activities is their specific region is undeniable. The presence and relative importance of clusters in the Scandinavian countries versus the early development and low existence of these competitive poles in the Baltic States, it is also well confirmed by the cluster data available in the European Cluster Observatory. According to this data, there are nearby 230 cluster organisations in the Baltic Sea Region. Over a third of these clusters (38%) are located in Sweden, closely follow by Denmark with 29% of cluster operating in the country. All in all, the fact that the bulk (85%) of all cluster organisations in the BSR are established in the Scandinavian countries, indicates how the drivers of regional and national innovation systems differ in these two groups of countries. This significant gap in clusters development is demonstrating that innovation systems models are, to some extend, more business driven in the Scandinavian countries in comparison to the Baltic States.

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Figure 30: cluster organisations in the Baltic Sea Region

Lithuania [LT] Germany [DE] Poland [PL] 2% 7% 4% Latvia [LV] 0% Denmark [DK] Estonia [EE] 29% 3% Suomi/Finland [FI] 17%

Sweden [SE] 38%

Source: European Cluster Observatory. Calculations by Technopolis Group Dissimilar to results for higher educations centres, the majority of clusters (close to 80%) identified by expert do not have any specific co-operation projects or networks in the Baltic Sea Region. Most of them have thus as common denominator the intention to stimulate the development, growth and competitiveness of a specific sector within their geographical location and the intention of co-operating with bordering regions/countries is not explicitly integrated as part of their activities. Clusters seem to be limited to a specific region that is much smaller than the Baltic Sea Region and often smaller than a country. Nonetheless, among the interviews with key stakeholders it has been repeatedly stated that there are an existing opportunities for further co-operation among all such clusters in a given field, for example of all life science biopharmaceutical clusters located in the Baltic Sea Region. Figure 31: Baltic organisation involvement in BSR co-operation

Don't Know 13%

No Yes 52% 35%

Source: Experts’ input. Calculations by Technopolis Group In general, the involvement of these national and regional organisations in BSR co- operation seems not to be, as of yet, very high. Certainly, Figure 31 shows that a considerable majority of the indentified organisations are not involved in any kind of co-operation programme or network with other Baltic Sea region. Only, over one third (35%) of the organisations are committed to any kind of trans-national or inter- regional co-operation with bordering countries. According to the information collected, the most active organisations in the BSR co-operation are primarily found in Finland, Sweden and Poland.

Figure 32: BSR organisation involvement in BSR co-operation

150 10 100 33 11 2 13 45 14 Don't Know 50 19 80 28 69 Yes 38 2 15 46 23 3 7 74 11 19 0 0 No

Source: Experts’ input. Calculations by Technopolis Group According to the latest report on the State of the region report17, the current set of institutions supporting and being actively involved in collaboration projects across the Baltic Sea region has grown over time. From the Nordic Council created in 1952 to the latest EU funded initiatives, collaboration projects and activities have significantly increased during the last decade. Additionally, a considerable number of cross-border organisations supporting cross-bordering collaboration have recently and gradually flourished (see section 6.1 for an overview and analysis of the most important transnational organisations promoting collaboration structures in the BSR).

5.2 Focus on early stage venture funding organisations in the BSR The issue of (early-stage) venture funding capacities in the BSR is the subject of one of the five flagships (7.2 Create a Baltic Sea Fund for innovation and research) of the EUSBSR (see Figure 35). All Member States have developed in one form or another, see Figure 33, public or public-private co-investment funds over the last decade, with the partial exception of Lithuania. In some cases, this has been done with ERDF support (e.g. Latvia) and/or with support from the European Investment Fund (EIB). Figure 33: overview of early-stage funding organisations in the BSR Country Main public or hybrid early stage Comment (ERDF co-financed, or seed capital funds thematic focus, etc.) Denmark • Innovationsmiljøer (incubators) • Innovation Incubators may invest up to de • Vækstfonden minimis threshold per company and together with Vækstfonden invest 60 % of the seed capital. Estonia • Arengufond (Estonian Development • No ERDF co-financing, operates as a pari Fund) passu investment vehicle with business angels and private venture funds Finland • SITRA • Venture capital investments within its specific programmes • Finnish Industry Investments • Only growth stage investments

• Veraventure • Investments in the seed and start-up stages (80% of Finnish early-stage market (2009) • VIGO • New business accelerator programme for

17 State of the region report 2010: the top of Europe Recovering, regional lessons from a global crisis. http://www.bdforum.org/show/english/reports_publications/state_of_the_region_report.aspx

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fast growing young companies Germany • High-tech Start-up Fund • Financed by the federal government • EXIST Gründerstipendium sources and by a small number of large enterprises • Federal Technology Venture Capital (VC) programmes Latvia • Venture capital funding programme • Since 2005, the programme has been co- (managed by three private venture financed by the ERDF funds) • Funds-of-funds within the Latvian Guarantee Agency Lithuania • Controlling fund established • Co-financed by the EU Structural Funds. Funds allocated during 2009-2010 for venture capital and business guarantees and loans of roughly €550m Poland • Plans for 20 new venture capital • ERDF co-financed under Measure 3.2 of funds during 2007-13 period the OP Innovative Economy • Fund of Funds established (2005) • ERDF co-financed Sweden • ALMI Invest • Co-funding from the ERDF • Innovationbron • Innovationbron seed funding products are: soft loans, development grants, equity and management support for incubators Source: authors compilation based on referenced materials and policy briefs for this study The three Nordic countries have all adopted different approaches to funding of young innovative firms and the provision of seed and early stage capital18. Despite a range of initiatives, in the Nordic countries the supply of private capital for the very early stage of venture capital – the seed stage - has been limited. Consequently, this space is at present dominated by public and publicly funded players. However, the review of the three Nordic countries early-stage (seed) capital funds underlined that fragmentation and sub-critical fund size allied to limited ‘deal flow means that the funds are not efficient. For example, in Finland, the status of the early stage investment industry was described as ‘critical’ with a mere five early-stage funds actively investing with few funds having above €50m under management, a limited ability to rapidly scale early stage companies to international growth and few investments even by those funds with over €50M under management reflecting the need for funds to reserve sufficient capital for follow-on investments or a change in investment strategy. Of the new Member States, the Estonian case is probably the most innovative, with the Estonian Development Fund, established as a co-investment vehicle, without ERDF support, with a mission extending beyond investments in start-ups to fostering the development of an investment culture; as well as a foresight and strategy development division providing input to the overall policy development for innovation. An ‘early’ evaluation after two year of operations19 found that the fund had been relatively successful in rolling out both an investment strategy and accompanying actions (e.g. establishing the Estonian Venture Capital Association). However, the restrictions set on the fund (e.g. no investments outside of Estonia) and the limited overall capital below the minimum industry standard threshold of at least €50m raised questions. Latvia was a ‘first mover’ amongst the new Member States, inspiring establishing a fund of funds, with ERDF support, which then invested in three privately managed venture sector funds. An assessment carried out as part of a DG REGIO study on innovative ERDF funded projects in 2009 found that that although the investment target has been revised downwards, the project could be considered a success.

18 For a good overview see the 2010 report from the Nordic Innovation Centre: Creating Nordic Success Stories Enhancing cooperation on the Nordic seed capital market. 19 Nightingale P. & Reid A. (2010) Early-stage Investment by the Estonian Development Fund, An appraisal of activities 2007-2009 and scenarios for future development.

In Lithuania, the 'Controlling fund', created with ERDF support, aims to improve SME access to external funding sources (micro crediting up to €25 000; venture capital fund investments; guarantees for SME financial obligations). However, at the current time, the early-stage funds available are limited. The situation is similar in Poland, which has struggled despite an ERDF measure during 2004-2006, to launch planned venture capital funds. The KFK (Krajowy Fundusz Kapitałowy, http://www.kfk.org.pl), a fund of funds, was established in 2005 with support from the ERDF and EIB. However, it did not make a call for tenders to allocate funds of up to 300m PLN) until 2009. During the current 2007-13 period, there is a plan to develop 20 venture capital funds which are excepted to invest in about 160 innovative start-ups; on average €1.5m per start-up. By November 2010, the KFK had invested in seven funds (€63m, approx. PLN250m) and hence initial individual investments have only begun in the last few months. It is clear from the overview of national organisation and experience that there is a potential for expanding both cross-country ‘learning’ and exchange of experience in the BSR on early stage funding but also potentially a greater integration or co- operation amongst early stage funds as well as the broader financial sector. Indeed, a 2007 report on “Financial Integration of the Baltic Sea Region Benefits and Barriers” argued that whilst, the Nordic countries are characterised by high levels of bank intermediation and developed nonbank sectors, financial systems in the Baltic countries are centred on conventional banking activates and non banking financial products (investment funds, venture capital funds and other nonbank investors) hold an asset share which is growing but still at a very moderate level20. The authors. argued that regional efforts to facilitate cross-border investments by actors in these categories could provide an important source of financing for SMEs in the Baltic and Polish markets. More recently, the 2010 NICE report on Nordic seed capital market, 2010 concluded that: “The resources on today’s Nordic seed market are scattered. Much is to be gained by benchmarking and sharing best practices among Nordic public investors and financers. Increased Nordic cooperation is expected to lead to higher critical mass and tighter networks that are vital for the success of early stage national investment programmes. Combined, the Nordic countries could constitute a common market of a size that would produce venture capital players in different stages with critical mass and global competitiveness”. Given the preceding observations on the difficulties of developing viable early-stage venture funds in the Baltic States and Poland, then if the term Nordic is replaced by the words Baltic Sea Region in the above paragraph then it sums up nicely the opportunity that could be pursued as part of the EUSBSR flagship project.

20 http://www.bdforum.org/download/Files/publications/Thematic%20Reports/Fin_l_Integration_Report _01.11.07.pdf.aspx?download=true

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6. Transnational innovation co-operation in the Baltic Sea Region

The study aimed to: • assess the extent to which the aspect of transnational cooperation is reflected in the regional innovation strategies. • identify existing cooperation links (including which sectors are covered) and to assess to which extent such links are covered by Cohesion policy-funded operational programmes and/or the EUSBSR. This section begins by considering the main structures and organisations established in the BSR to support inter-governmental and transnational co-operation; including the strategic framework established by the EUSBSR.

6.1 Baltic sea co-operation and the EU’s Baltic Sea Region Strategy Baltic sea co-operation has been developed gradually over the last 20 years subsequent to the collapse of the ‘Iron Curtain’ at the end of the 1980s. A number of intergovernmental or inter-regional bodies have been created and developed over the last two decades; while Baltic Sea region ‘co-operation networks’ in a wide range of fields have also been established.21

6.1.1 Inter-governmental co-operation Baltic Sea region inter-governmental co-operation has focused to a significant extent on the environmental challenges facing the sea with agreements such as HELCOM enshrining priorities in this area. Clearly since the accession of all countries bordering the BSR (aside from Russia) to the EU, EU level institutions and programmes have become a main driver of inter-governmental co-operation. However, both prior to and after EU accession, a number of other inter-governmental organisations have played a leading role in the co-ordinating BSR policy priorities. At inter-governmental level, the Council of the Baltic Sea States (CBSS)22, established by the region’s Foreign Ministers in Copenhagen in 1992, is an overall political forum for regional intergovernmental cooperation. The members of the Council are the 11 states of the Baltic Sea region23 as well as the European Commission. Its work is organised around five main priority areas: environment, economic development, energy, education and culture, and civil security. Since 2009, the CBSS has placed an even stronger focus of its activities on maritime and sustainable development policies (establishment of a new CBSS expert group on Maritime Policy, the integration of the Baltic 21 network into the CBSS structure as an expert group on sustainable development, and the creation of a project facilitation budget line to be used as seed money for future CBSS projects. Economic development (under which innovation would fall) activities is not currently a main focus. Established in 1971, the Nordic Council of Ministers (NCM; www.norden.org) is the platform for intergovernmental cooperation between the Nordic countries. NCM has a broad range of activities within 11 different Ministerial Councils. Traditionally, the area of education, research, culture, and innovation account for over half of the annual

21 The Helsinki Commission, or HELCOM, works to protect the marine environment of the Baltic Sea from all sources of pollution through intergovernmental co-operation between Denmark, Estonia, the European Union, Finland, Germany, Latvia, Lithuania, Poland, Russia and Sweden. HELCOM is the governing body of the "Convention on the Protection of the Marine Environment of the Baltic Sea Area" - more usually known as the Helsinki Convention. 22 http://www.cbss.org 23 Denmark, Estonia, Finland, Germany, Iceland, Latvia, Lithuania, Norway, Poland, Russia and Sweden.

budget of approximately € 120 million. Over the last few years, collaboration on competitiveness issues, in particular research and innovation, has become an ever more prominent part of the agenda. Compared to the CBSS, and aside from the scale of budget available to the organisation per se, NCM is differentiated from the CBSS in that it has a number of ‘agencies’ and notably in the field of research and innovation the Nordic Innovation Centre http://www.nordicinnovation.net, NORDFORSK http://www.nordforsk.org/en, Nordic Energy Research the funding institution for energy research http://www.nordicenergy.net. In addition, the Nordic Investment Bank (NIB) http://www.nib.int/ finances projects that strengthen competitiveness and enhance the environment. The Bank offers long- term loans and guarantees on competitive market terms to its clients in the private and public sectors. NIB is an international financial institution owned by Denmark, Estonia, Finland, Iceland, Latvia, Lithuania, Norway and Sweden. Over the last decade, the NCM has sought to work closely with neighbouring countries around the BSR, notably with the three Baltic States (Estonia, Latvia and Lithuania) in the so-called Nordic-Baltic 8 framework (NB8). In addition to NCM offices in each of the Baltic States a number of specific programmes aim to strengthen co-operation and pursue policy agendas. For instance, the Nordic-Baltic Mobility and Network Programme for Business and Industry was launched in 2009 to strengthen co- operation in entrepreneurship and innovation field. Case 9 Nordic–Baltic Mobility Programme for Business and Industry The Nordic–Baltic Mobility Programme for Business and Industry is part of a longer Nordic-Baltic co-operation that was initiated in 1991 and has developed into a political co-operation in areas of joint priorities. The current Programme is planned to be operational for the period 2009 – 2013. The programme aims to strengthen business co-operation, entrepreneurship, and regional cluster co-operation between the Nordic and Baltic (Denmark, Estonia, Finland, Iceland, Latvia, Lithuania, Norway and Sweden) countries. It provides financial support to different stakeholders in the fields of business and industry to carry out study visits, internships, on-the-job training or network and cluster facilitating activities in Baltic or Nordic countries. The programme is administered by the Nordic Council of Ministers’ Office in Latvia (the Management Body). The Nordic Council of Ministers (NCM) decides on the operation and funding for the programme. The annual budget of the programme is financed by the Nordic Council of Ministers and the governments of Estonia, Latvia and Lithuania. Co-funding from beneficiaries is also mandatory. In 2009 and 2010 101 projects were funded in total. Beneficiaries were businesses and organisations supporting the private sector. Several projects resulted in continuous cooperation between the involved parties, as for instance the Latvian Transport and Logistics cluster initiated FP7 project with the partners from the mobility programme project. The programme has shown evidence on how mechanisms to initiate and support the co-operation at initial phase are necessary.

In the spring of 2010, Latvia and Denmark in their capacities as the presidents of the Baltic Council of Ministers and the Nordic Foreign Policy Cooperation, respectively, decided to establish a ‘wise men’ group to look into how to advance cooperation between the Nordic and Baltic countries (NB8) in order to strengthen relations and address common regional and global challenges more efficiently. The NB8 Wise Men Report (NB8, 2010) focused essentially on recommendations for further co-operation in security, energy and defence policies. However, it did note that: “in general, that following accession of the Baltic States to the EU, the Nordic countries took a less active approach, leaving more room for the Baltic countries to adjust to their new status in Europe” and that ‘Somewhat paradoxically, the lack of comprehensive political NB8 cooperation came at the same time as Nordic businesses actively started

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entering the Baltic business sphere, mainly through direct investments and partnerships’. In this context, the role of the EU, both in terms of the broad policy framework (the Lisbon Strategy during the period up to 2010 and currently the Europe 2020 objectives) and the access to EU funding programmes (Structural Funds including inter-regional co-operation, Research Framework Programmes, etc.) have clearly given a new dimension to the co-operation around the Baltic Sea. Given the importance of, notably, the Structural Funds as a source of funding (particularly in the Baltic States and Poland), a key question is the extent that BSR co-operation is driven by a cohesive and shared vision of priorities to which EU instruments contribute. In short, currently, innovation, together with environment sustainability, accounts for a significant share of the regional and cross-border activities pursued at intergovernmental level in the BSR24.

6.1.2 Baltic Sea region transnational co-operation networks In addition to inter-governmental co-operation, a significant number of BSR networks have developed over time25. A number of the BSR level networks and organisations are in fields relevant to the innovation agenda and the main ones are listed in Figure 34. From the review of the existing institutions, it is striking to see the significant number of inter-intergovernmental forums and political networks established in the BSR. The NB8 Wise Men report (NB8 2010) noted that ‘there is no need for new regional structures; indeed, there are voices even advocating the dissolution of many of the existing ones which some find to be redundant or inefficient. In comparison to the public sector representation, the business sectors, seems however to be less organised and represented in the Baltic Sea cooperation landscape. Figure 34: main Baltic Sea region public and NGO 'network organisations' Co-operation network Structure & objectives Weblink The Nordic Council of Ministers • The NCM is the forum for Nordic http://www.norden.org/ (NCM) governmental co-operation

• Denmark, Finland, Iceland, Norway and Sweden have been members since 1971 • The Nordic Council has 87 members, elected among the members of the national parliaments. The council of the Baltic Sea • The council of the Baltic Sea States is a http://www.cbss.org/ States (CBSS) regional forum for intergovernmental collaboration between the eleven countries of the BSR and the European Commission established in 1992 • It consists of the Ministers for Foreign Affairs from each Member State and a member of the European Commission. The Presidency of the Council rotates among the MS on an annual basis • Members are responsible for funding common activities and/or for seeking and coordinating financing from other sources

24 State of the region report 2008:sustaining growth at the top of Europe. by Christian Ketels 25 See for instance the list of organisations on the CBSS website: http://www.cbss.org/Content/links

Co-operation network Structure & objectives Weblink The Baltic Sea States • BSSSC is a political network for http://www.bsssc.com/ Subregional Cooperation decentralised authorities (sub-regions) (BSSSC) in the BSR • It acts as a regional partner to the CBSS SINCE 1993 • Its participants are regional authorities of the 10 BS littoral states promoting and advocating the interest of the sub-regions to national level and EU institutions Baltic Development Forum • Baltic Development Forum is an http://www.bdforum.org/ (BDF) independent non-profit networking organisation for business, governments, regional organisations, academia and the media to discuss, facilitate and develop new initiatives in BSR • Established in 1998, it is supported by a broad variety of members and strategic partners (public and private actors) The Baltic Sea Chambers of • The BBCA is an organisation of al http://www.bcca.ws/ Commerce Association (BBCA) together 50 chambers of commerce across the Baltic Sea Region. It is run by its members and has an elected presidium (the Presidents/CEOs of some of the members) • It promotes trade and business relationships across the Baltic Sea Region Baltic Sea Unit (SIDA) • This Baltic Sea arm of the Swedish http://www.sida.se/balticse International Development aunit Cooperation Agency, works to further promote and develop relations and cooperation between diverse actors in the BSR • Since 2005, it helps to establish and fund cross-border projects and initiatives in three prioritised key areas: environment, social issues, and civil security Baltic Sea Trade Union Network • BASTUN is an independent network of http://www.bastun.nu/ (BASTUN) 22 member trade union confederations • It works as a forum where the trade unions of the Baltic Sea Region exchange information and discuss and define common interests • Additionally, The network aims at political and social influencing, coordinates joint projects and raises issues related to BSR within the international trade union

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Co-operation network Structure & objectives Weblink Nordic Investment Bank (NIB) • NIB is an international financial http://www.nib.int/ institution owned by Denmark, Estonia, Finland, Iceland, Latvia, Lithuania, Norway and Sweden • NIB's member countries have subscribed authorised capital according to a distribution key based on the eight member countries' gross national income • It promotes sustainable growth of its member countries by providing long- term complementary financing, primarily on projects that strengthen competitiveness and enhance the environment The Union of Baltic Cities (UBC) • Network of over 100 cities from 10 http://www.ubc.net/ countries in the BSR to collaborate on various political, economic and social issues • It promotes the exchange of know-how and experiences between the cities Vision and Strategies around • VASAB is a platform for http://www.vasab.org/ the Baltic (VASAB) intergovernmental multilateral co- operation of 11 countries of the Baltic Sea Region in spatial planning and development • Set up in 1992, it organises on Ministerial Conference (every two or three years) giving basis for further strengthening and harmonisation of national and regional spatial planning policies The Baltic Metropoles Network • BaltMet represents eleven capitals and http://www.baltmet.org/ (BaltMet) large metropolitan cities around the BSR • Its main goal is to promote innovativeness and competitiveness by engaging cities, as well as academic and business partners, into close cooperation Baltic Sea Region Programme • As one of 13 European transnational http://www.eu.baltic.net/ 2007-2013 cooperation programmes, the programme co-finances co-operation projects in the BSR • Its objective is to strengthen the development of sustainable, competitive, and territorially integrated BSR Nordic Innovation Centre • Under the auspices of the Nordic http://www.nordicinnovati Council of Ministers, Nordic on.org/ Innovation works on implementing the Nordic trade, industry and innovation partnership programme • It cooperates with many different public and private companies, organisations and governmental agencies in the Nordic region

Co-operation network Structure & objectives Weblink Baltic Institute of Finland (BIF) • The Baltic Institute of Finland is a http://www.baltic.org/ non-profit foundation-based organisation promoting cooperation and partnerships around the BSR • Its central aim is to promote the launch of tangible collaboration projects in the BSR, and facilitate the participation of Finnish organisations • It is maintained by the Foundation for the Baltic Institute, founded by the City of Tampere • The Baltic University Programme http://www.ubc.net/ University Programme (BUP) (BUP) is a network of about 225 http://www.balticuniv.uu.s universities and other institutes of e/ higher learning throughout the Baltic Sea region • The Programme focuses on questions of sustainable development, environmental protection, and democracy in the Baltic Sea region. The aim is to support the key role that universities play in a democratic, peaceful and sustainable development Baltic Sea Region University • The BSRUN agreement was signed by http://www.bsrun.org/ Network 16 institutions in Turku on 28 http://www.bcca.ws/ February 2000. • The BSRUN has 34 member institutions in Belarus, Estonia, Finland, Latvia, Lithuania, Poland and Russia Baltic University Programme • The Baltic University Programme http://www.balticuniv.uu.s (BUP) (BUP) is a network of about 225 e/ universities and other institutes of higher learning throughout the Baltic Sea region • The Programme focuses on questions of sustainable development, environmental protection, and democracy in the Baltic Sea region. The aim is to support the key role that universities play in a democratic, peaceful and sustainable development

6.1.3 The EU’s Baltic Sea Region Strategy As noted in previous sections, the role that EU instruments play in supporting the development of BSR co-operation has steadily grown since the first half of the 2000 decade. Initially, EU funding supporting co-operation operated through cross-border and inter-regional co-operation programmes (INTERREG during the 2000-2006 programming period of the Structural Funds). The Baltic Sea Region Strategy, endorsed by the European Council in October 2009, is the first macro-regional strategy (subsequently inspiring a similar strategy for the Danube region). It has the objective of coordinating action within a functional region, by responding to the key challenges of: (i) enabling a sustainable environment, (ii) enhancing the region’s prosperity, (iii) increasing accessibility and attractiveness and, (iv) ensuring safety and security in the region.26 The strategy recognises that it is vital to strengthen transnational co-operation, both at the policy and business level to

26 http://ec.europa.eu/regional_policy/cooperation/baltic/

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provide an integrated approach identifying needs, solutions and matching them to available resources in the Baltic Sea Region. In the field of innovation, the cluster approach is identified as a potential tool for building on existing mapping studies in the region, the BSR Inno-Net project (2006- 09) funded under PRO INNO Europe27 as well as results of the European Cluster Observatory28. The 7th of the 15 priorities of the EUSBSR calls for joint effort is “to exploit the full potential of the region in research and innovation”, helping to overcome the wide disparities in research and productive innovation. The strategy therefore aims at building upon opportunities such as a well-educated workforce, expertise in innovation particularly in the knowledge-based industries and a strong tradition of inter-regional co-operation. Within the innovation related priority 7, two actions and four flagship projects have been highlighted in the accompanying action plan29 to the Strategy. Strategic actions include ‘establishing a common Baltic Sea Region innovation strategy’ and ‘Improve the exploitation of research through patents’ under cooperative actions. Flagship projects include: ‘develop a Baltic Sea region programme for innovation, clusters and SME-Networks’, ‘create a Baltic SEA Fund for innovation and research’, ‘develop a common Baltic Sea region strategy to promote services innovation’, ‘set-up cross- sectoral reference projects for innovation in health and life sciences’, and ‘setting up a Baltic Science Link’. A year into the implementation phase, the work has, so far, focused on the launch of the flagship projects. However, the implementation of the aforementioned flagship projects is still at an embryonic stage, with the exception of BSR Stars. Figure 35: Priority 7 flagship project state of completion

Flagship Project: Priority 7 Stage of implementation

7.1 BSR Stars- A Baltic Sea Programme for • Governance structure, developed a design and a plan Innovation, clusters and SME networks for the Flagship implementation

7.2 Create a Baltic Sea Fund for innovation • Starting-up phase, pre-planning phase and research

7.3 Develop a common Baltic Sea Region • No action yet strategy to promote services innovation

7.4 The BSR Health region • Ongoing and open project

7.5 Setting up a science link • Starting-up phase, pre-planning phase

The development of a Baltic Sea Region programme for innovation, clusters and SME networks has resulted in the BSR Stars programme (7.1). Building on existing commercial strengths and competencies around the BSR, the BSR Stars aspires to, , foster the development of strategic alliances and collaborative innovation projects aimed to tackle common challenges. The opportunity is then to use a demand driven way of working with grand challenges and strong BSR capabilities. The vision for BSR Stars is to achieve global market lead within areas of grand challenges i.e. clean tech, future energy, future health, transports and telecommunication.

27 http://www.proinno-europe.eu/bsr-innonet 28 www.clusterobservatory.eu 29 The Action Plan sets out 15 Priority Areas and 80 flagship projects across the four pillars ‘Environment’, ‘Prosperity’, ‘Accessibility’ and ‘Safety and Security.

In terms of its development, the other flagship project worthwhile mentioning, is the ScanBalt project (7.4). The mission of ScanBalt Health Region is to set up cross- sectoral and transnational reference projects for collaboration and innovations in both health and in life sciences to promote public health on a high and sustainable level and to make the Baltic Sea Region a globally leading and prosperous Health Region (see also Case 1). The ScanBalt BioRegion introduced the basic principles of sustainability in 2004 within all fields of life sciences whether it is health, energy, nutrition, or environmental life sciences. The Baltic Sea Region can in this sense be regarded as a model for providing the basis for a knowledge-based economy and for implementing a shared strategy together in a sustainable way in a broad spectrum of activities. The first review and update of the entire action plan will take place during the P0lish Presidency of the EU in the second half of 2011. Subsequent reviews will be followed during later Baltic Sea Region presidency. The opportunity is then to use a demand driven way of working with ‘grand challenges’ and strong BSR capabilities.

6.2 Transnational networks and organisations funded by EU programmes EU funding programmes supporting RTDI co-operation at transnational or inter- regional level across the BSR have been highlighted as playing an essential role during the interviews. For this reason, a specific section of the study is devoted to this issue. Therefore, and in addition to the identification of nationally or regionally based organisations (Section 5) and the main transnational and intergovernmental co- operation networks (see Figure 34), this section identifies the various EU funded BSR inter-regional and transnational initiatives with a mission to operate at Baltic Sea level or covering more than one country or region in the research and innovation field. A distinction has been made between: • Regional and national organisations that have a remit or mission statement to operate at BSR level • Transnational or inter-regional projects and networks (supported notably by EU funding instruments such as ERA-NETs, INNO-NETS, INTERREG, etc.)

6.2.1 Baltic Sea Region Programme 2007-13: fostering innovation sub-theme The EU’s Baltic Sea Region Programme 2007-13 promotes regional development through transnational cooperation by funding projects to foster innovations, internal and external accessibility, the Baltic Sea as a common resource, and attractive and competitive cities and regions. Partners from 11 countries (eight EU and Belarus, Norway and Russia) are working together with a total programme budget of €236m coming from ERDF and Norwegian national funding30. There are about 65 transnational projects contributing to the four pillars as well as the 15 priorities areas of the BSR Strategy. Within the fostering innovation priority, a total of 22 projects, with a minimum of three BSR countries and partners involved, are currently supporting transnational co-operation. The list of lead partners involved in the programme is provided in Appendix D. Of special interest are the BSHR HealthPort and StarDust projects, both of which are partly financed by the BSR Programme and are fully aligned with priority 7 of the EUSBSR (see section 6.1) The targeted sectors for these projects are very diverse and the number of projects funded is still not sufficient enough to confirm superior sectoral support coming from the fostering innovation sub-theme projects. However, energy, ICT and environment (including climate change) are among those sectors for which a greater number of

30 For more information see: http://www.eu.baltic.net

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projects have been funded (three projects each). Other sectors such as creative industries or biotechnology have also had a slightly higher support (2 projects). Figure 36: Overview of BSR Programme 2007-2013 fostering innovation projects

Project Name Number of countries Number of project partners involved BaltFood 7 17 Baltic Fashion 8 11 BalticSupply 6 9 BaSIC 10 16 Best Agers 9 7 BONITA 7 14 BSHR HealthPort 4 9 BSR InnoReg 7 34 BSR QUICK 3 9 BSR_CBP 6 3 COOL Bricks 7 19 FM 9 13 IBI Net 7 15 ICT for Health 8 9 JOSEFIN 7 23 Longlife 8 40 MIN-NOVATION 7 19 PlasTEP 7 11 REMOWE 8 11 SPIN 6 12 StarDust 7 18 URBAN CREATIVE POLES 6 18 Source: Baltic Sea Programme 2007-2013 secretariat

6.2.2 INTERREG IV C - innovation & the knowledge economy sub-theme The INTERREC IV Programme makes available ERDF funding for interregional co- operation for the period 2007-2013. Nevertheless, the geographical scope (Europe) and the areas of support differ from those of the BSR programe. INTERREG IVC focuses on innovation and the knowledge economy and environment and risk prevention. The programme’s overall objective is “to improve the effectiveness of regional policies and instruments”. Under the innovation and the knowledge economy priority of INTERREG IVC, there are 51 projects with 124 partners from the BSR. The highest number of participants, with respectively 41 (33%) and 34 (27 %), are based in Sweden and Finland. The presence of Baltic countries is diverse. Where Estonia presents a rather satisfactory participation rate (12 organisations involved), the participation of Latvia and Lithuania can be seen as particularly low (both of these countries have each only eight organisations). German and Polish regions are also less represented in comparison to Sweden, Finland or Denmark. As a result, Sweden, Finland and Denmark account for over 70 % of all organisations involved (88 out of a total of 124). A list of organisations is provided in Appendix D. The projects running under the innovation and knowledge economy priority must address one of four given subthemes (figures in percentage are share of BSR participants by theme):

• Innovation, Research & Technological Development (23%) • Entrepreneurship and SMEs (38%) • Information Society (17%) • Employment, Human Capital and Education (22%) As far the targeted fields are concerned, government and social relations, creative industries and ICT need to be highlighted recur most often for the BSR participants.

6.2.3 ERA-NETs Scheme The ERA-NET scheme aims to strengthen the coordination of research programmes through allowing national and regional authorities to identify research programmes they wish to coordinate or open up mutually. The participants in these actions are therefore typically ministries or regional authorities defining research programmes or programme 'managers' such as research councils or other research funding agencies managing research programmes. The scheme, which initially started with FP6 and was later expanded under FP7, has supported 139 projects in which at least one organisation of the BSR countries has participated. All BSR countries are involved in the scheme. Germany31 (35% of all projects) is by far the leading participant and Finland, Sweden, Denmark and Poland present a significant involvement. A list of organisations and corresponding country is provided in Appendix D. Figure 37 ERANETs: BSR priority fields (FP6& FP7)

"Transport "Socio-economic (including "Environment sciences and aeronautics)" "Energy" (including climate humanities" 9% 4% change)" 4% 15%

"Food, agriculture "None (e.g. a and fisheries" 11% ‘horizontal’ ERA- NET)" 32% "Health" 6% "Nanosciences, nanotechnologies, "Information and materials and new communication production technologies" technologies" 4% 15%

Source: NETWATCH website. Calculations Technopolis Group Furthermore, for ERANET projects with BSR participation, the most predominant interest fields of the active ERANETs in the BSR are in scientific or technical domains (such as nanoscience or nanotechnologies) as well as on specific policy areas generally related to societal challenges (climate change and environment issues). Finally, it is interesting to mention a special involvement in traditional sectors such food, agriculture and fisheries (see Case 10).

31 The data from the NETWATCH database does not allow to differentiate atthe NUT2 level, therefore, Germany and Poland have been taken at the country level.

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Case 10: BONUS for Baltic Sea Science – Joint Baltic Sea R&D Programme The Bonus programme brings together the research community of marine, maritime, economical and societal research to address the main societal challenges faced by the Baltic Sea System, and more particularly in the maritime eco-system The current BONUS programme 2010-2016 acts as continuation to the previous BONUS ERA-NET and BONUS+. The BONUS ERA-NET running between 2004- 2008, was a joint project put forward to develop the establishment of a Joint Baltic Sea Research Programme. BONUS+ pilot initiative followed to test the system of collaboration among the national funding institutions launching it first call for proposals in 2007. The first Bonus project was funded under the ERA-NET scheme as part of the FP6 2002-2006, it was funded by the EU as well as all members and associated members of the EEIG. Its successor, Bonus+ was two thirds coming from national funding agencies and one third funded by EU ERANET+. During the actual phase of the project for the period 2010-2016, half of the funding (€50 million) come from EC funding and the remaining 50% of the budget from national contributions. The different BONUS phases have, generally speaking, helped bringing together the key research funding organisations from all the EU member states around the Baltic Sea. At this first stage, the programme did not offer funding for networking of scientists or research projects. Instead, it made the national research funding organisations cooperate by building up a Joint Baltic Sea Research Programme to fund research. Progressively, the BONUS+ opened a new stage of cooperation through the call for proposals launched in 2007. The programme has funded a total of 16 projects involving over 100 research institutes and universities and has set out to test the mechanisms of collaboration among national funding institutions. Source: Bonus programme website: http://www.bonusportal.org

6.2.4 Regions of Knowledge, Europe-Innova and INNO-Nets Under the RoK Programme, nine projects with involvement from the Baltic Sea Region were identified. Three of these projects are in the ICT and information society sector; two in the socioeconomic science and humanities; and the other two are focused in the environment field. The highest participation can be found in Sweden and Denmark, both of which stand for 80% of the total of organisations involved.32 In comparison to RoK, Europe INNOVA and INNO-NETs have a considerable number of projects running in the BSR. For INNO-NETs the expert team has identified 13 projects and the sum of 30 BSR organisations involved. As for Europe-Innova, 29 projects have been identified with over 60 partners organisations involved. ICT and information society together with environment sector have been the most recurrent fields financed by Europe- Innova. Once more, the most active organisations for both of these programmes are located in Finland and Denmark followed by Sweden (11 organisations).

32 More information on the projects, theme of calls and targeted field of the nine projects funded by Regions of knowledge is provided in Appendix D.

Figure 38: Europe INNOVA: BSR targeted sectors

Services Space Automotive Biotechnology 2% 5% 2% Materials 7% 10% Building 13% Energy ICT and 3% information society 20% Environment (including climate change) 19%

Health and ageing society 3% Government and Food, agriculture social relations and fisheries 2% 14% Source: Europe Innova website. Calculations by Technopolis Group

6.2.5 Transnational cluster co-operation in the BSR First efforts to develop transnational linkages among clusters in the Baltic Sea Region were taken by the Nordic Council of Ministers and through the Nordic Innovation Centre. The Northern Cluster Alliance, launched by FORA, Innovation Norway, TEKES and VINNOVA in 2004, became a first platform for exchanging practices on cluster policies. In 2006 the Baltic Sea Region Innovation Network (BSR INNO-Net) was launched under the PRO INNO Europe initiative of the European Commission. The BSR INNO-Net aimed at creating operational and long-term links between cluster policy makers, implementing agencies and analysts in the Baltic Sea Region. The partners established a joint conceptual framework for cluster policy formation, evaluation and operational activities across national borders and created joint innovation programmes for cluster development. Pilot projects were initiated with clusters cooperating under areas such as biotechnology, food, ICT and wood production and furniture. The BSR INNO-Net has been a very successful policy forum on clusters and provided a basis and many new ideas to the EU Strategy for the Baltic Sea Region33 presented by the European Commission in 2009. Specific projects in the field of clusters have been supported via the “Baltic Sea Region INTERREG IIIB Neighbourhood Programme 2000-2006”34 and later by the “Baltic Sea Region Programme 2007-2013”35. For example the projects, “Connect BSR” and “Connect BSR+” funded under the 2000-2006 programme targeted the development of clusters according to the triple helix model, including the development of new companies, raising venture capital and developing model solution. Cluster-related support areas of the 2007-2013 programme are the “stimulation of transnational interactions between enterprises, R&D institutions and public authorities towards territorial expansion of clusters” and the “integration of SMEs into existing transnational co-operation clusters” with several projects going on such as the BaltFood or BalticSupply. Today, transnational cluster activities are part of the EU Strategy for the Baltic Sea Region, more specifically of the BSR Stars36 flagship programme (See Section 6.1.3).

33 http://ec.europa.eu/regional_policy/cooperation/baltic/index_en.htm 34 http://www.spatial.baltic.net/ 35 http://eu.baltic.net/ 36 http://www.bsrstars.se/

68 Innovation in the Baltic Sea

Figure 39: Summary of projects on clusters under different initiatives BSR INNO Net (funded BSR Programme (funded BSR Stars flagship under the under FP6) 2006-2009 under ERDF) 2007-2013 BSR Strategy 2010 - • Pilot on food • BSR Capacity Building Stardust • Pilot on furniture Programme • Mobile Vikings • Pilot on ICT • BaltFood • Active for Life • Pilot on bioenergy • BalticSupply • Marchain • Clean Water • Comfort in Living

Case 11: Transnational Cluster Cooperation in the ICT field in the BSR: Mobile Vikings The ICT sector in the BSR is highly developed with advanced technologies hosting many important ICT clusters. In this context, “Mobile Vikings” aims to excel in new methodologies and tools leveraging BSR’s strengths in telecommunication/mobile applications and services. The key building block of the approach is to exploit the vast theoretical knowledge on open innovation and user and demand-driven innovation and put concrete new methods in practice as part of the innovation strategies of companies, academia and society. Mobile Vikings is a five partner consortium from five countries led by Mobile Heights (Sweden) with the Latvian ICT Cluster, Øresund IT, HERMIA, Competence Cluster for Ubiquitous Computing and Visorial Information Technology. There are a further 11 associated partners from Norway, Demark, Poland, Germany, Finland and Sweden. The collaboration is focused on creating new products and services in new and growing companies piggy-backing on the international networks of global enterprises. The project aims at new user- and demand driven business and innovation models that secure jobs and competitiveness with a thematic focus on digital business and services and ubiquitous solution. The activities include: firstly, the development of test beds for new products and services in the telecommunications/mobile applications area. Secondly, an investigation of how open innovation methodologies can be used by cluster managers; thirdly, creating a real and unified Baltic Sea market in the specific field. Source: http://www.bsrstars.se/stardust/mobile-vikings/

6.3 Framework Programme cooperation International research cooperation within the EU and with associated countries has been funded for more than two decades via the EU’s Framework Programmes for Research and Technological Development (FP). Given the different accession dates to the EU of the BSR countries, some have a longer research cooperation history than others using this EU mechanism. This may result in larger numbers of individual participants or in larger numbers in terms of individual participations by country or region. Given that FP participation is open to partners from all EU and associated countries, it is interesting to analyse actual cooperation patterns amongst countries and regions37. At the NUTS level, the FP6 data is only available at country level (NUTS 1) for the Baltic States and Denmark, however, data for Germany, Finland, Poland and Sweden is available at NUTS 2 and NUTS3 levels. The European Commission’s (EC) total

37 As names of the participants are not standardised and the addresses, in particular the NUTS codes, are not always complete, it is impossible to identify for example cooperation densities of any given organisation (participant) without an enormous cleaning effort. The analysis thus results in conclusions such as “region x cooperated ten times with participants from within the region, 40 times with other domestic regions and 100 times with other EU regions.” Thus the term “participations” is used rather than participants, as the latter is misleading.

financial contribution under FP6 amounted to €15.5 billion o which 92% (€14.2 billion) was allocated within the EU27 Member States. The BSR regions obtained roughly €1.4 billion, with Sweden (€624 million), Denmark (€372 million) and Finland (€314 million) leading. The BSR NUTS2 region that received the smallest funding was Warmińsko-Mazurskie with almost €1m. In terms of priority areas, Information Society Technologies obtained the largest share with 23% of total EC grants, followed by Life sciences, genomics and biotechnology for health (14%) and Sustainable development, global change and ecosystems (13%). However, the BSR showed clear preferences for two priority areas: Sustainable development and ICT obtained each about 19%, followed by life science with 13% (Figure 40). Figure 40: BSR participations in FP6 by priority area

1. Life sciences, genomics and biotechnology for 816 health

1176 2. Information society technologies

3. Nanotechnologies and nanosciences, 537 knowledge-based multifunctional materials and new production processes and devices 190 4. Aeronautics and space

359 5. Food quality and safety

6. Sustainable development, global change and 1184 ecosystems

7. Citizens and governance in a knowledge-based 202 society

130 Euratom

538 Horizontal research activities involving SMEs

656 Human resources and mobility

Policy support and anticipating scientific and 483 technological needs

0 200 400 600 800 1000 1200 1400

Source: E-Corda, Treatment and calculations: Technopolis Group A regional breakdown is presented in Figure 41 for the sustainable development priority area. At country level, Sweden shows the highest number of participations, followed by Denmark and Finland. At the regional level, South Finland (FI18) has the highest number of participations, followed by West Sweden (SE0A). The absence of two of the northern Polish regions in this priority area is noteworthy. If the field is a core Baltic Sea unifying priority, then the lack of cooperating Polish partners suggests a weakness that may be explained by a missing research infrastructure or a less developed integration in international research networks.

70 Innovation in the Baltic Sea

Figure 41: BSR participations by region in FP6, priority area Sustainable Development, global change and ecosystems

Mecklenburg-Vorpommern [DE8] 19 Schleswig-Holstein[DEF] 49 Denmark 314 Estonia 52 Latvia 42 Lithuania 31 Zachodniopomorskie [PL42] 3 Warminsko-Mazurskie [PL62] 0 Pomorskie [PL63] 47 Finland 201 Itä-Suomi [FI13] 12 Etelä-Suomi [FI18] 158 Länsi-Suomi [FI19] 22 Pohjois-Suomi [FI1A] 5 Sweden 420 Stockholm [SE01] 108 Östra Mellansverige [SE02] 69 Sydsverige [SE04] 75 Norra Mellansverige [SE06] 15 Mellersta Norrland [SE07] 8 Övre Norrland [SE08] 15 Småland med öarna [SE09] 14 Västsverige [SE0A] 110

0 50 100 150 200 250 300 350 400 450

Source: E-Corda; Treatment and calculations: Technopolis Group Note: The Swedish NUTS codes follow the old, 2003 NUTS classification A rather similar picture can be seen for the Information society technologies (Figure 42), with the difference that Finland is relatively more involved and the difference to Sweden compared to the previous field is much lower. In terms of main regions, South Finland is still the dominant Finnish region but for Sweden, the Stockholm region (SE01) is by far the most active in this priority area, followed by West Sweden (SE0A). Figure 42 BSR participations by region in FP6, priority area: information technologies

Mecklenburg-Vorpommern [DE8] 4 Schleswig-Holstein[DEF] 22 Denmark 199 Estonia 54 Latvia 71 Lithuania 31 Zachodniopomorskie [PL42] 4 Warminsko-Mazurskie [PL62] 2 Pomorskie [PL63] 12 Finland 330 Itä-Suomi [FI13] 2 Etelä-Suomi [FI18] 249 Länsi-Suomi [FI19] 45 Pohjois-Suomi [FI1A] 30 Sweden 441 Stockholm [SE01] 198 Östra Mellansverige [SE02] 61 Sydsverige [SE04] 48 Norra Mellansverige [SE06] 16 Mellersta Norrland [SE07] 2 Övre Norrland [SE08] 20 Småland med öarna [SE09] 5 Västsverige [SE0A] 91

0 50 100 150 200 250 300 350 400 450 500

Source: E-Corda; treatment and calculations: Technopolis Group Note: The Swedish NUTS codes follow the old, 2003 NUTS classification Given the focus on innovation in the BSR, the analysis of the rather small FP priority area, ‘Horizontal research activities involving SMEs’ is pertinent. The priority received only 3% or roughly €465 million under FP6, and accounted for 9% of all BSR

participations. However, as priority is aimed at generating a relatively high proportion of participations by smaller firms it is interesting to look at from the perspective of Baltic Sea wide knowledge transfer. The key figures concerning this priority are: • 490 projects were funded; 255 (52%) are with a BSR participant; • A total of 5,440 participations, including also FP-associated countries like Norway or Turkey; with 524 (9.6%) participations of BSR. • 91% of the organisations participated only once. 6% took part twice and only 3% participated more than two times; • Project size ranged from three to 46 participants with an average of 11; for the BSR participant projects, the range was from 3 to 40 with an average of 11. • The priority area involved a large share of industry (61%) followed by public research organisations (17%), the higher education sector (11%), and ‘other’ (11%). While German participants make up 13.5% of the priority area, for the two German BSR regions, this priority has very low relevance: not even 1% of participations from Mecklenburg-Vorpommern and only 2.7% from Schleswig-Holstein. The overall Polish share in this priority is 3.9%: Pomorskie (PL63) provides 8% of the participations and 1% from each of the two other regions. Figure 43 BSR participations by region in FP6, priority area Horizontal research activities involving SMEs

Germany 735 Mecklenburg-Vorpommern [DE8] 7 Schleswig-Holstein[DEF] 20 Denmark 122 Estonia 50 Latvia 18 Lithuania 42 Poland 210 Zachodniopomorskie [PL42] 2 Warminsko-Mazurskie [PL62] 2 Pomorskie [PL63] 17 Finland 104 Itä-Suomi [FI13] 6 Etelä-Suomi [FI18] 62 Länsi-Suomi [FI19] 22 Pohjois-Suomi [FI1A] 9 Sweden 157 Stockholm [SE01] 47 Östra Mellansverige [SE02] 21 Sydsverige [SE04] 21 Norra Mellansverige [SE06] 6 Mellersta Norrland [SE07] 4 Övre Norrland [SE08] 4 Småland med öarna [SE09] 9 Västsverige [SE0A] 42 0 50 100 150 200 250 300

Source: E-Corda; Treatment and calculations: Technopolis Group Note: The Swedish NUTS codes follow the old, 2003 NUTS classification By type of organisation (Figure 44), the BSR participation varies from the overall FP6 patterns, the most striking difference being the lower share of public research institutes (12% BSR versus 17% overall). In the Polish regions, but also in many Finnish and Swedish regions, the sector is not involved. This may be because the public research centres in these regions are not well integrated with regional SMEs. In Finland, the share of public research centres participations is well above average at 19%, however, only one participation is not from South Finland (FI18). There is a similar pattern in Sweden with the overall share of public research organisations around average (13%) but 60% of participations from Southern Sweden (SE0A) and

72 Innovation in the Baltic Sea

20% from Stockholm region (SE01) while the other six regions have either one or zero participations. Figure 44: BSR participations by type of participant in FP6, priority area Horizontal research activities involving SMEs

Other; 12%

Higher Education; 13%

Research ; 12% Industry; 63%

Source: E-Corda; data treatment and calculations: Technopolis Group

Do the Baltic Sea regions co-operate more amongst themselves or seek partners from a broader geographic area? From the 255 projects where BSR participants were involved 524 times, there is only one project entirely composed of BSR partners (an ICT project with seven partners from DE8, EE, FI, LT, and LV). Moreover, 43% of the projects had a single BSR partner, 21% two and three projects had eight or more BSR partners (see Figure 45). More than 50% of the project partners were from the BSR in 17 projects. Figure 45 : Number of BSR participants per project, FP6, priority area Horizontal research activities involving SMEs

120

100

0 1 2 3 4 5 6 7 8 9 13

Source: E-Corda, data treatment and calculations: Technopolis Group In summing up, the analysis of FP6 participations tends to lead to similar conclusions as to those of the specialisation analysis, in that the thematic fields of BSR participation in the FP correspond to those identified as cross-region strengths. Equally, while there is a logic to co-operate with ‘neighbours’ working on the same or related topics, in a search for scientific excellence, this is less of a first choice criteria. Establishing ‘joint programmes’ where BSR Member States pool national funds and launch common calls for proposals for R&D projects could help strengthen current co- operation patterns.

7. Conclusions and recommendations

7.1 Conclusions The following four main conclusions are derived from the study Innovation performance and opportunities: common challenges, diverse strengths Innovation performance in the Baltic Sea Region The Baltic Sea Region as a macro-region is a sub-set of the diversity of innovation is far from homogenous potential that can be found in the EU as a whole. The BSR includes areas with widely a fact that needs to be varying levels of economic development and innovation potential. This diversity of acknowledged in regional potential exists not only between countries (the three Baltic States and the planning transnational northern Polish regions versus the Nordic countries) but also nationally. The two co-operation German regions, for instance, are comparatively weak performers from a national perspective. Equally, not all regions in the ‘innovation leaders’ are ‘equal’, for instance, while the Finnish capital region is a European ‘powerhouse’, Eastern Finland lags well down the European regional innovation scoreboard. This fact appears to be less well reflected in the strategic foundations of the Baltic Sea A BSR research and strategy and in transnational co-operation as promoted to date. Moreover, while the innovation area is Nordic countries have been able to develop and pursue jointly the concept of the unlikely to be achieved Nordic research and innovation area (NORDIA), the development of a Baltic Sea without much more research and innovation area will be a considerably greater challenge without the same developed transnational level of sophistication or longevity of transnational ‘governance structures’ as exists ‘institutions’ amongst the Nordic countries.

Unbalanced efforts to focus and specialise innovation policies The review of innovation strategies and policies round the BSR provides evidence of a considerable effort at both national and regional levels to develop tailored research and innovation policies responding to specific strengths and weaknesses in the business and higher education and research sectors. The mapping of policy priorities highlights a number of key areas where stakeholders consider available funding should be focused, including: • ICT • Life science (notably biotechnology) • Healthcare (and ‘wellness’) services: • Agro-food • ‘Cleantech’ (notably in Denmark and Finland); • Energy (notably renewables) (with some overlap with cleantech field) Regional innovation • Materials (ranging from nanotech, through plasma to more traditional materials) strategies have adopted a specialisation agenda, However, in a number of cases, the policy prioritisation is more ‘on paper’ than but the level of pursued in an effective operational manner. Equally, there is an imbalance between a sophistication varies more in-depth evidence based understanding of specialisation strengths in the Nordic markedly between the regions (and to some extent the German regions) and a more nascent effort to focus ‘north-west’ and ‘south- funding in the Baltic States and Polish regions. east’ rims of the Baltic A second issue is that while the mapping highlights many similar areas of policy Sea. specialisation across the BSR regions, the specific focus in each region may be rather different (e.g. in the materials field ranging from smart textile to plasma, or between blue, white and red biotech).

74 Innovation in the Baltic Sea

A macro-region with many talents but a lack of critical mass The organisational mapping identified 490 main organisations active in the field of innovation or an average of 20 per BSR region. The sheer number and diversity of organisations present even in the smaller (in population terms) Member States or regions is impressive. Moreover, the study highlights a well-developed ‘tradition’ of broad-based regional partnership driving innovation developments notably in the three Nordic States. Yet the flip side of the coin is that this ‘multiplication’ of organisations may be at the same time an inherent weakness. Somewhat bluntly, does a macro-region with a The BSR is rich in population of around 37m people need 80 plus science parks, 200 plus universities, ‘innovation 200 plus clusters, etc. Or to put the question in a more sophisticated manner, even if organisations’, but the there is a ‘proximity matters’ argument for multiplying the number of ‘innovation risk of duplication of intermediaries’ are they able to offer the scope, quality and depth of services required effort and to support businesses to innovate or to educate and train creative people ? fragmentation of capacity weakens the From a BSR strategic perspective this should not imply a top-down ‘rationalisation’ potential of the macro- but rather the need to develop even more structured transnational co-operation in region. order to avoid a further phase of multiplying organisations that involve budgetary commitments from national, regional or EU funds. In all points of the triple helix (business, academic-research and government), a strategic reflection is needed on how to improve knowledge on what exists and guarantee access to pre-existing expertise and innovation infrastructures in the BSR. Examples from both within the region (e.g. the BONUS programme) and further afield could be used to inspire future action.

The Structural Funds are a major contributor to BSR innovation policy but are not yet ‘levelling the playing field’. During the 2007-13 period, the Structural Funds are investing close to €5.5 billion in support of research, technological development and innovation (RTDI) across the 25 BSR regions. Close to 40% of this total is allocated to Estonia, Latvia and Lithuania The Structural Funds and a further 28% of the total is invested in the three Polish Baltic Sea regions. In are investing €5.5 billion terms of the focusing of this funding, 62% of investment in research centres and a in research and similar share of investment in developing human potential for research and innovation heavily innovation is allocated to the three Baltic States. Close to 50% of ERDF investment in concentrated on the favour of research infrastructure is concentrated in three ‘regions’ out of 25 round the weaker innovation BSR (Mecklenburg-Vorpommern, Estonia and Lithuania). This concentration of performers in the BSR. funding represents a massive boost to the research and innovation systems of the ‘catching-up’ countries and regions concerned. Clearly, the importance of the Structural Funds varies both, from a budgetary and strategic orientation perspective, across the BSR. In Member States with regions eligible for support under the Convergence Objective (Estonia, Germany, Latvia, Lithuania, Poland) the share of the ERDF in total government expenditure on RTDI is considerably higher than in the eligible regions (Denmark, Germany, Finland and Sweden) for the Regional Competitiveness and Employment objective. Equally, in the two larger Member States (Germany and Poland) account must be taken of ‘multi-level governance’ context with both regional policy measures and national (operational) programmes intervening.

In both budgetary and strategic terms the Structural Funds are extremely significant The investment while in Estonia, Latvia, Lithuania and the Polish regions. They represent the vast-majority considerable will at best of public RTDI funding in these countries. As noted earlier, these are equally the ‘level the playing’ field in countries for which catching up on innovation is a key element for securing future a few specialised fields competitiveness. However, the rate of implementation is rather slow with limited of business innovation results to report to date according to interviewees. Moreover, while in absolute terms or academic research. for the countries concerned the funding is considerable, in relative (per capita) terms the Structural Funds contribution barely influences the ‘innovation investment’ gap between the Nordic and the other less-developed regions round the Baltic Sea. At best

the longer run gains will help the Polish regions and Baltic States to balance the playing field in a few selected niche’ in terms of quality and excellence of R&D and innovation activities enabling them to co-operate as ‘equals’ with Nordic partners. In the Nordic countries, although in comparative terms, Structural Funds are a much more marginal share of innovation policy funding, they are seen as providing the resources for ‘ground-breaking’ new ideas and as ‘fundamental and necessary in early phase of new developments’. Moreover, they often leverage other public-private funds into innovative platforms. The lessons of Structural Funds programming from the ‘more advanced BSR regions, highlight ‘mistakes’ that need to be avoided in the current convergence regions, namely a focus on developing a first class infrastructure, e.g. in the German region of Mecklenburg-Vorpommern ‘most research buildings’ received ERDF support, but stakeholders noted that more attention should have been paid at an earlier stage to developing competitive R&D activities.

Transnational co-operation that is ad hoc and ‘project-based’ with limited synergies with regional or national strategies. The interviews with stakeholders carried out highlight that while they recognise the validity of the logic behind co-ordinating efforts in favour of upgrading research and innovation potential at the Baltic Sea in practice this has proved difficult: National and regional operational programmes were designed without any There is little or no • (significant) thought to integrating national investments in a transnational integration of a framework; transnational Baltic Sea dimension in national • Measures and investments were decided before the EUSBSR was adopted and it and regional proved difficult to align the national measures to the new strategy programmes. • Most of the current co-operation is ‘bottom-up’, driven by bidders perception of how to align their interests with programme priorities and essentially ‘project- based’ (short-term, one-off). Hence, it does not lead (with some exceptions) to a structuring of capacity or permanent joint activities. • In general, stakeholders find it more effective to develop stronger bilateral (cross- border or focused co-operation between a limited number of organisations) links than platforms that cover the entire BSR. The evidence suggests that without EU funding programmes in place the level and Without EU funding intensity of co-operation across the Baltic Sea region would be limited at best. At the programmes the level of current time, the co-operation is also largely ‘public sector’ driven and more account co-operation amongst could be taken of how to build on pre-existing co-operation (business supply chains or the BSR would be much thematically focused research and innovation platforms with a business or societal more limited. driven demand). In the field of research and innovation co-operation funded by EU programmes (INTERREG, Baltic Sea programme, ERANET, etc.) the patterns of co-operation do suggest that a number of common themes are a focus of interest of Baltic Sea partners, notably: environment and sustainable development, ICT and life sciences. Stakeholders interviewed underlined that the flagship projects of the EUSBSR could provide a new more structured framework. To date the most developed of the five flagship projects is the BSR Stars project which draws on a decade or more of cluster related co-operation, underlining the rationale to build on upon pre-existing networks.

76 Innovation in the Baltic Sea

7.2 Recommendations: a future role for transnational co-operation in supporting Baltic Sea innovation policies A strong rationale for increased co-ordination of innovation strategies and ‘joint programming’ in a number of fields The study findings suggest that there are options for further integration and co- development of innovation strategies and policies in the Baltic Sea region in at least five fields. To some extent, our findings confirm the orientation of the flagship projects of the EUSBSR, however, some additional options and some issues requiring further attention are also raised. Macro-region clusters and ‘competence centres’ The most developed of the EUSBSR flagship projects under priority 7 (innovation) is the BSR Stars project. The findings of the study tend to confirm the rationale for a more structured and strategic programming driven approach to ‘cluster’ co-operation in the Baltic Sea region. However, there is a need to take into account the differing levels of development and the different competitive advantages of the clusters around the Baltic Sea if not there is a risk that the initiative simply reinforces existing disparities pulling resources towards the strongest clusters. In addition, the need for supporting a strong long-term structured co-operation between regional ‘competence centres’ (business-academia R&D consortia) could be investigated. Most nations round the BSR now have such competence centres and many operate in similar or potentially complementary fields, greater integration of market-led R&D would be beneficial. This could lead to triple helix or business- industry platforms in specific key technologies as identified in the mapping of the study. A Baltic Sea Fund for financing of innovative enterprises Recent Nordic wide studies on early-stage funds for young innovative enterprises have underlined that current early-stage and seed-funds are sub-critical even in Denmark, Finland and Sweden. Whilst the German regions can draw on a larger national financial sector, their weaker innovation profile does not necessarily make them first priority for national funds. The Polish regions and Baltic States are experimenting with various forms of funding for early stage firms, however, the deal flow is not sufficient in these regions to support the minimum scale for a viable early-stage fund. Similarly, innovative public procurement (another option for promoting the development of new, technology based firms) is still only at the very initial stages even in the three Nordic countries. The opportunities for developing BSR procurement platforms giving groups of local and regional authorities more capacity to source innovation solutions from young innovative firms in fields such as cleantech or renewable energies should be explored. In both these areas, there is a real rationale for extending Nordic efforts to create even greater critical mass and develop expertise across the entire BSR. Future EU (ERDF and EIB) support for early-stage funding should be made conditional on regional and national funds not being restricted to investing in ‘local companies’ and on the linking or merging of sub-critical national funds (eventually be through a BSR Fund-of- Funds). The Danish experience, where local Innovationsmiljøer (incubators) invest initial seed capital, up to de minimis levels, with follow on funding provided by the national early stage fund (Vækstfonden) could be a model for developing similar tight links between incubators and S&T parks and investors at BSR level. An open access network of Baltic Sea research infrastructures The study underlines that current efforts to develop a strategic approach to investments in research infrastructures are piecemeal and sub-optimal in the context of the ESFRI and the specific priorities of the Baltic Sea region. The level of

sophistication and preparedness varies widely from the Nordic countries own national plans and Nordic wide coordination to more ‘rudimentary’ and inadequately defined priorities in other regions. The experience to date of investment of ERDF funds in research infrastructures in the Baltic States, for instance, suggests that investment decisions are driven first and foremost by institutional priorities (universities). Open access plans aimed at ensuring optimal use of the infrastructure or equipment are considered as ‘administrative requirements’ rather than real business plans providing a basis for revenue generating or cost-sharing activities. Notably in the BSR regions eligible for ERDF funding under the Convergence objective, the current focus is on ‘catching up’ on several decades of under-investment in building and equipment rather than on structuring investments so as to complement available infrastructures elsewhere in the macro-region. Hence, somewhat bluntly, the priority seems to be to maximise square metres of lab space rather than to use available funds to create the maximum access to infrastructures for researchers and companies. In this area, there is need for a stronger ‘oversight’ by the European Commission (plus EIB) to avoid dispersion of funding and duplication of infrastructure or equipment investments. Pre-conditions for all future ERDF co-financed investments in research infrastructure or major elements of research infrastructure should be a) international peer-reviewed regional or national research infrastructure plans explaining how proposed investments will ensure a clear synergy with ESFRI and generate identifiable ‘value added’ compared to pre-existing infrastructure in neighbouring Baltic Sea regions b) ‘open access business plans’ proving, based on a market survey, demand from not only national but also other BSR researchers/businesses for buying time or sharing facilities. From the Commission’s side, the need to review ERDF rules on revenue generation so as not to discourage efforts to make R&D centres ‘self-financing’ and bring rules on eligibility of operating costs into line with those of the Framework Programme for research should be a priority. Joint programming rather than project based funding of BSR research and innovation programmes In the period since 2004, the development of plans for joint programming in the field of research and innovation through ERANETS, etc. and the efforts to develop various Baltic Sea region networks through ERDF funded transnational projects has created a basis for a new programmed approach that is structured around longer-term research and innovation priorities rather than ‘networks and projects’. Hence, the study recommends a shift away from a ‘bottom-up’ project based funding. Rather, available funds (national budgets, ERDF/ESF, other EU or Nordic funding streams) could be structured into a limited number of three to four strategic Baltic Sea region research and innovation funding programmes. In addition to work under existing ERANETS to develop joint programmes, models that could inspire such developments are the Nordic Top-Level Research Initiative (http://www.nordforsk.org/en/programs/programmer/toppforskningsinitiativet) or national models including from outside the BSR region, such as the Scottish Research Pools (http://www.sfc.ac.uk/research/researchpools/researchpools.aspx). The need for a BSR Mobile Expertise programme A fifth area where more could be done to exploit complementarities and synergies is to enhance access to expertise in emerging or advanced technologies. The organisational mapping underlined that there is a significant range of expertise in various technology fields and in terms of innovation advisory services. However, it is unlikely that most of the regions or smaller member states around the BSR can mobilise ‘locally’ all expertise required by innovative businesses. Equally, a lot of (ESF) funding is being channelled into improving higher educational (doctoral schools, innovative teaching

78 Innovation in the Baltic Sea

methods, mobility schemes, etc.) and vocational training systems. Scope for synergies exist and are not yet exploited adequately. Possible examples of actions could include: • Enhanced efforts to develop Baltic educational (doctoral schools, etc.), mobility programmes, or life long learning programmes in priority fields (ESF co-financed actions); • Pooling expertise available to S&T parks, centres and incubators, etc. through a BSR Innovation Advisory network potentially linked to an innovation vouchers scheme (ERDF co-financed actions).

Technopolis Belgium Avenue de Tervuren 12 B-1040 Brussels Belgium T +32 2 737 74 40 F +32 2 727 74 49 E [email protected] www.technopolis-group.com

Appendix A Relevant literature

A.1 Business clusters and scientific and technology specialisation • Sectoral Innovation Watch − Europe Innova [EI] (CIP): http://www.europe-innova.eu − European Cluster Observatory http://www.clusterobservatory.eu • Monitoring European Trends in Social Science and Humanities (METRIS) http://www.metrisnet.eu/ • Exploring regional structural and S&T specialisation: implications for policy. Regional Key Figures of the European Research Area Booklet 2008. Prepared by Dr. Viola Peter Technopolis Group and Rainer Frietsch, Fraunhofer ISI • Regional Innovation Scoreboard. Hugo Hollanders (MERIT), Stefano Tarantola and Alexander Loschky (JRC) (December 2009) A.2 Organisational mapping • BONUS Baltic Organisations Network for Funding Science EEIG http://www.bonusportal.org/ • International Associations of Science Parks http://www.iasp.ws/publico/intro.jsp • ERA-NETs http://netwatch.jrc.ec.europa.eu/ • INNO-Policy Trendchart http://www.proinno-europe.eu/trendchart • ERAWATCH http://cordis.europa.eu/erawatch/index.cfm • Regional Innovation Monitor http://www.rim-europa.eu/ A.3 Transnational co-operation in the Baltic Sea Region • Baltic Sea Region Programme 2007-2013 http://eu.baltic.net • Nordic R&D collaboration at EU level: NORDERA. IPTS (September 2010) • Baltic Partnerships: Integration, Growth and Local Governance in the Baltic Sea Region. OECD (April 2007) • Creating links in the Baltic Sea Region by Cluster cooperation- BSR Innonet: follow-up report on clusters pilots. Karin Nygård Skalman, Anna Zingmark (VINNOVA) (April 2010) • FP7 eCORDA database (RTD-FP7) • Interreg IV C – subtheme “Innovation, Research and Technological Development” (ERDF) http://i4c.eu/ • INTERREC IV C Interregional Cooperation - First collection. Joint Technical Secretariat of the INTERREC IV C European Commission (July 2009) • INTERREC IV C Interregional Cooperation - Second collection. Joint Technical Secretariat of the INTERREC IV C European Commission. (June 2010) • Eurada (2010) Mapping of INTERREC IV C (Subtheme “ Innovation, Research and Technological Development”), Regions of Knowledge and Europe Innova Project Partners. • Eurada (2010) Results of the experiment in programme-level capitalisation on INTERREG IVC projects in the subtheme innovation, research and technology development.

A.4 Assessment of ERDF contribution • ERAWATCH analytical country reports (September 2009) • Assessment of the impact of the Regions of Knowledge (ROK) programme. Technopolis Group for Directorate-General for Regional Policy (ongoing) • Ex-post assessment of regional programmes of innovative actions. Technopolis Group for Directorate-General for Regional Policy (December 2010) • Strategic Evaluation on innovation and the knowledge based economy in relation to the 2007-13 Structural Funds period. Technopolis Group for Directorate- General for Regional Policy (2006). Technopolis Group

Appendix B Guideline for interviews with key stakeholders

B.1 Guideline for interviews with key stakeholders 1. Background and context Name, organisation, position and contact details (minimum email address) of respondent. Please explain briefly the role of your organisation in the regional and/or national and innovation system ? To what extent have you or your organisation been involved in Baltic Sea region (BSR) co-operation in the field of innovation ? 2. Organisational mapping Aside from your own organisation, which are the five main institutions within the research and innovation system in your country/region? Please comment on your knowledge of their involvement in BSR actions. Name of Role Website Contact Active in BSR organisation person & networks, etc. email (Name) Policy making/ (http) Name Yes/no/don’t know implementation/ @ cluster manager/ R&D performance/ advisory services (Name) Policy making/ (http) Name Yes/no/don’t know implementation/ @ cluster manager/ R&D performance/ advisory services (Name) Policy making/ (http) Name Yes/no/don’t know implementation/ @ cluster manager/ R&D performance/ advisory services (Name) Policy making/ (http) Name Yes/no/don’t know implementation/ @ cluster manager/ R&D performance/ advisory services (Name) Policy making/ (http) Name Yes/no/don’t know implementation/ @ cluster manager/ R&D performance/ advisory services

3. Innovation policy mapping and smart specialisation Prior to the interview, the interviewee should be sent the results of the policy mapping for their region/country in order to allow them to comment on it. Nb: If the respondent indicates that there are other strategy documents or key measures, these should be identified and added to the policy mapping: minimum information to collect: name, year (of publication/launch), organisation responsible, website/weblink. To what extent does the table you received reflect the up to date situation in terms of : • national/regional innovation strategies in favour of research and innovation • the main innovation related policy measures ?

Definition of a smart specialisation strategy (SSS): “smart specialisation involves businesses, research centres and universities working together to identify a region’s most promising areas of specialisation, but also the weaknesses that hamper innovation.” • To what extent is there an evidence based understanding of the scientific, technological or industrial specialisation in the region/country concept ? • Does the current regional RTDI policy adequately respond to the regional specialisation or needs of specific key business sectors &/or has focused resources on a few key competitive areas ? • To what extent does the current national/regional innovation policy target specific technologies, sectors (including services) or clusters ? Nb: Areas of particular interest include: formation and development of clusters, innovation-friendly environment for business (in areas such as energy, IT, environment and forestry/wood), embedding lifelong learning in research and innovation, strengthening of research infrastructures and centres of competence, public procurement, use of ICT. − If yes, which fields/sectors/clusters are targeted by RTDI policy ? − How well do the prioritised fields corresponds to the scientific, technological and industrial strengths of your region/country ? − What share of RTDI funding is clearly thematically or sectorally focused? • How well is the RTDI policy articulated with other policies (environment, education, ICT, transport, employment & social affairs, etc.)? • How important is the ERDF (or ESF) contribution to supporting the implementation of research and innovation strategies/measures in your region/country? Have the Structural Fund programme helped to focus or target policy on specific strategic sectors or technology fields ? 4. Transnational cooperation (TC) • How important is transnational or inter-regional funding at BSR level as a complement to national or regional funding measures ? • Considering the main R&D competence centres and infrastructures in your region/country: − How well are they integrated in Baltic Sea Co-operation ? − Does the planning of investment in research infrastructure or new R&D centres take account of other existing R&D centres or infrastructures around the Baltic Sea in the same field ? • How important are EU Structural Fund programmes (Interreg IV, Baltic Sea Region Programme 2007-13) in fostering RTDI related co-operation or the coordination of RTDI related investments (e.g. pooling of R&D infrastructures, sharing of expertise or joint funds for supporting high-tech start-ups, etc.) • To what extent are EU funding instruments other than the Structural Funds important for supporting national/regional and/or BSR co-operation in the field of innovation ? For instance FP7, CIP, ERA-NET, INNO-NETS, JPIs) ? • Is there a trend towards greater or less BSR co-operation ? and if so what factors influence the intensity of co-operation (lack of incentives, complexity of programmes, legal or administrative obstacles, difficulties to develop joint or inter-regional strategies, lack of knowledge/trust between potential partners, etc.) • In your opinion, what are the future or unexploited opportunities for transnational co-operation in the field of RTDI in the BSR region? 5. Good practice and future options

• What are the current (or future expected) main outcomes/impact of ERDF funded RTDI measures in your region/country ? • What lessons would you draw from the past/current experience and how can research and innovation (SS) strategies be improved in the future? • Can you recommend any innovation measures from within your country/region that you deem to be working well/good practice? • Are you aware of any good-practice examples of Baltic Sea region co-operation or co-ordination actions in the field of RTDI ?

B.2 Overview of interviews with key stakeholders Name of interviewed Organisation Position Team expert Jari Romanainen Tekes Executive Director, Alo Merilo Customerships

Virve Vimpari European Commission Desk Officer for Finland Alo Merilo Markku Wallin Ministry of Employment Permanent state Alo Merilo and Economy of Finland undersecretary Ilze Beināre Ministry of Economics Head of Anete Vitola of Republic of Latvia Entrepreneurship Competitiveness Department, Dace Ratniece Ministry of Education Head of Policy Anete Vitola and Science of Latvia Coordination Department Arina Andreičika Ministry of the Head of Development Anete Vitola Environmental Instruments Protection and Regional Department Development of Latvia Agnese Dagile DG REGIO, European Desk Officer for Latvia Anete Vitola Commision Dorota Kopeć Marshal Office of Deputy Head of Jacek Walendowski Warmia and Mazury Department of Regional Voivodeship Policy Izabela Mirotta- Marshal Office of the Head of Unit of Jacek Walendowski Murawsk, Pomorskie Voivodeship Entrepreneurship and Innovation, Department of Economy Gunnar Edlund VINNOVA Senior Advisor Jakob Hellman Marie-Louise Eriksson Department of Business Development Jakob Hellman Economic Development Manager & Innovation, Region Skåne Johan Holmberg Swedish Research Research officer, Jakob Hellman Council department of research funding Anders Olsson, Region Värmland Responsible “Innovative Jakob Hellman environments” Peter Stern

Hans-Åke Persson, , Region Västra Götaland Responsible Objective 3 Jakob Hellman Peter Stern Christer Christensen, Regional Growth, Senior Advisor Jakob Hellman Ministry of Enterprise, Peter Stern Energy and Communication, Sweden Göran Brulin Swedish Agency for Senior Analyst and Jakob Hellman Economic and Regional professor Peter Stern Growth Lars Fernvall, Swedish National Director, External Jakob Hellman Agency for Innovation Affairs, Peter Stern Systems Dr Albertas Žalys Ministry of Education Director, Department of Jelena Angelis and Science of Lithuania Higher Education, Science and Technology,

Johan Magnusson DG REGIO, European Desk Officer for Jelena Angelis Commision Lithuania Ministry of Economy of Director of Innovation Jelena Angelis Almantas Danilevičius Lithuania and Knowledge Society department Association Santaka Director Jelena Angelis Eugenijus Mačinėkas Valley (Kaunas)

Wolfgang Blank BioCon Valley CEO Viola Peter

Henner Willnow Senior Consultant

Bernd Ross Ministry of Science, Head of Section: Policy Viola Peter Technology and issues university policy,

Transport of Land academic planning, Schleswig-Holstein International, knowledge and technology transfer Kaarina Williams Staatskanzlei Schleswig- Coordinating Viola Peter Holstein transnational cooperation concerning the BSP

Appendix C Results of analysis of policy databases

C.1 Baltic Sea research & innovation stakeholders and organisations in ERAWATCH-TrendChart and RIM databases Geographical Name of the organisation coverage Denmark [DK] Danish Agency for Science, Technology and Innovation Etelä-Suomi [FI18] Danish Council for Research Policy Danish Council for Strategic Research Danish Council for Technology and Innovation Danish National Advanced Technology Foundation Danish National Research Foundation GTS - Advanced Technology Group Ministry of Economic and Business Affairs Ministry of Science, Technology and Innovation Technical University of Denmark The Danish Council for Independent Research The Danish National Advanced Technology Foundation The Danish Technological Institute The growth fund The Prevention Fund Universities Denmark (former Danish Rectors' Conference) University of Copenhagen Centre for Economic Development, Transport and the Environment of Uusimaa Culminatum Innovation Oy Ltd Forum Virium Helsinki Lahti School of Innovation, Lappeenranta University of Technology Lahti Science and Business Park Ltd Regional Council of Päijät-Häme Uusimaa Regional Council Germany [DE] Federal Ministry of Economic Affairs and Technology Federal Ministry of Education and Research Hovedstaden [DK01] Biopeople Business Link Greater Copenhagen Capital Denmark Growth Forum Copenhagen Cleantech Cluster Danish Design Centre Innovation Center Copenhagen Medicon Valley Alliance Øresund Food Øresund IT ScanBalt Scion DTU Symbion The Capital Region of Denmark Itä-Suomi [FI13] Centre for Economic Development, Transport and the Environment of Pohjois- Karjala MikTech Ltd The Regional Council of Etelä-Savo Länsi-Suomi [FI19] Centre for Economic Development, Transport and the Environment of Pirkanmaa City of Tampere Council of Tampere region Jyväskylä Regional Development Company Jykes Ltd Regional Council of Central Finland Regional Council of South Ostrobothnia Latvia [LV] Association of Mechanical Engineering and Metalworking Industries of Latvia

Association of Textile and Clothing Industry Business Innovation Center of Latvian Electronic Industry CONNECT Latvia Council of Higher Education Investment and Development Agency of Latvia Latvia Technology Park Latvian Academy of Sciences

Latvian Council of Science Latvian Electrical Engineering and Electronics Industry Association Latvian Information and Communications Technology Association Latvian IT Cluster Latvian Land and Mortgage Bank Latvian Rectors' Council Latvian Space Technology Cluster Latvian Technological Center Latvian technological parks, centers and business incubators association Life Science Cluster of Latvia Ministry of Economics Ministry of Education and Science Ministry of the Environmental Protection and Regional Development National Development Council Ogre Business and Innovation Incubator Patent Office of the Republic of Latvia Riga City Council City Development Department Riga Technical University State Education Development Agency State Regional Development Agency The Association of Latvian Chemical and Pharmaceutical Industry The Latvian Federation of Food Enterprises University of Latvia Ventspils High Technology Park Lithuania [LT] Lithuanian University of Agriculture (LŽŪU Science and Technology Park) 'Technopolis' Science and Technology Park Agency for International Science and Technology Development Programmes in Lithuania Alytus Regional Development Agency Ignalina NPP Region Business Incubator Ignalina Nuclear Power Plant Regional Development Agency Institute of Botany Institute of Geology and Geography Institute of Hygiene Integrated Maritime Science, Business and Education Centre (Valley) INVEGA Invest Lithuania Kaunas Chamber of Commerce, Industry and Crafts Kaunas High-Tech and Information Technology Park Kaunas Regional Development Agency Kaunas Regional Innovation Centre Kaunas University of Technology Kazlu Rudos Business Incubator Klaipėda Chamber of Commerce, Industry and Crafts Klaipeda Economic Development Agency Klaipeda Science and Technology Park Klaipeda University Knowledge Economy Forum KTU Regional Science Park Laser and Light Science and Technology Association Lithuanian Veterenary Academy Lithuanian Business Support Agency Lithuanian Energy Institute Lithuanian Innovation Centre Lithuanian Institute of Agrarian Economics Lithuanian State Science and Studies Foundation Lithuanian University of Agriculture National Centre for Technological Platforms National Regional Development Agency Nemunas Valley NorthTown Technology Park Panevezys Chamber of Commerce, Industry and Crafts Panevezys Science and Technology Park Santaka Valley Siauliai Business Incubator Siauliai Chamber of Commerce, Industry and Crafts Siauliai Regional Development Agency Siauliai University Sunrise Valley Telsiai County Business Incubator

The Lithuanian Academy of Science The Republic of Lithuania Ministry of Economy The Republic of Lithuania Ministry of Education and Science The Research Council of Lithuania Utenos Regional Development Agency Vilnijos Business Incubator Vilnius Chamber of Commerce, Industry and Crafts Vilnius Gediminas Technical university Vilnius Santara Valley Vilnius University Visoriai Information Technology Park Vytautas Magnus Univeristy MECKLENBURG- Max Planck Institute for Plasma Physics VORPOMMERN BioCon Valley [DE8] Biotechnikum Greifswald Campus Plasmamed Equity Funds for SMEs (mutual institution of local banks) Federal State Institute for Public Funding Fraunhofer Institute for Computer Graphics Research (IGD-R) Guarantee Bank Mecklenburg-West Pomerania Hanseatic Institute for Entrepreneurship and Regional Development (HIE-RO) Institute for Technological Consulting Leibnitz Institute for Catalytsis (LIKAT) Leibniz Institute for Plasma science and technology Ministry for Education, Science and Culture of Mecklenburg-West Pomerania Ministry of Economy, Labour and Tourism Mecklenburg-Vorpommern Research Association Mecklenburg-Vorpommern Technology Centre of Western Pomerania University of Greifswald University of Rostock Steinbeis-Transferzentrum Technologiemanagement Nordost ATI Küste GmbH Mellersta Norrland Åkroken Science Park [SE32] Business Incubator Östersund County Administrative Board of Jämtland County Administrative Board of Västernorrland Fiber Optic Valley Mid Sweden University Midtjylland [DK04] Agro Business Park Agro Food Park Business Link Central Denmark Development Centre UMT Growth Forum Central Jutland INCUBA Science Park Innovation Lab Innovation Network for Biomass Østjysk Innovation Region Central Denmark TEKO Nordjylland [DK05] Aalborg University BioMed Community BrainsBusiness ICT NORTH DENMARK Business Link Northern Jutland Center for Sundhedsteknologi Northern Jutland Growth Forum NOVI Research Park Region of North Jutland Norra Mellansverige BoomTown [SE31] Borlänge Science Park Compare Karlstad Foundation Dalabit Faxepark High Voltage Valley Inova Movexum Region Gävleborg Region Värmland Regional Cooperation Council of Dalarna Sandbacka Park Steel & Engineering

Teknikdalen Foundation The Packaging Arena The Paper Province The technology park in Gävle Triple Steelix Östra Mellansverige County Administrative Board of Södermanland [SE12] County Administrative Board of Västmanland Create Idélab Mälardalen University Munktell Science Park Örebro Regional Development Council Östsam Regional Development Council Sörmland Regional Council The robot valley University of Örebro Uppsala BIO Uppsala Innovation Centre Uppsala Regional Council Uppsala University Västerås Science Park Övre Norrland Acusticum [SE33] Aurorum Business Incubator Aurorum Science Park Bpark County Administrative Board of Norrbotten Internetbay Luleå University of Technology North Sweden ProcessIT Innovations Region Västerbotten Solander Science Park The Norrland Fund Umeå Biotech Incubator Uminova Innovation Pohjois-Suomi [FI1A] Centre for Economic Development, Transport and the Environment of Pohjois- Pohjanmaa Council of Oulu Region Oulu Innovation Ltd The University of Oulu Poland [PL] Foundation for Polish Science Ministry of Economic Affairs Ministry of Science and Higer Education Polish Academy of Science Polish Agency for Enterprises Development Polish Business and Innovation Centres Association The National Centre for Research and Development Pomorskie [PL63] Baltic Centre for Biotechnology and Innovative Diagnsotics Ltd "BioBaltica" Baltic Eco-Energy Cluster Business Angel Seed Fund Centre of Maritime Technology Electrotechnical Institute Gdańsk Branch Gdańsk Construction Cluster Gdańsk University of Technology Gdynia Maritime University Institute of Hydroengineering of Polish Academy of Sciences Inveno Fund Maritime Institute in Gdańsk Marshal Office of the Pomorskie region Polish Federation of Apparel and Textile Pomerania Development Agency Pomerania ICT Cluster Pomeranian Science and Technology Park Regional Pomeranian Chamber of Commerce Sea Fisheries Institute in Gdynia Ship Design and Research Centre The Gdańsk Science and Technology Park The Szewalski Institute of Fluid-Flow Machinery (IMP) The University of Gdańsk

Innovation Centre in Slupsk of the Polish Federation of Engineering Association - NOT SCHLESWIG- Academy of Economics Schleswig-Holstein HOLSTEIN [DEF] Business Development and Technology Transfer Corporation of Schleswig-Holstein GmbH European Forum for Telemedicine Fraunhofer Institute for Marine Biotechnology (EMB) Fraunhofer Institute for Silicon technology Guarantor Bank of Schleswig-Holstein Helmholtz-Zentrum Geesthacht Centre for Materials and Coastal Research Innovation Foundation Schleswig-Holstein Investitionsbank Schleswig-Holstein (IB) Kiel Institute for the World Economy Leibniz Institute of Marine Sciences at the Christian-Albrechts Universität zu Kiel (IFM-GEOMAR) Lübeck University of Applied Sciences Luebeck Business Development Corp. Max Planck Institute for Evolutionary Biology Ministry for Labour, Social Affairs and Health - Schleswig-Holstein Patent Commercialisation Agency Prime Minister office of Schleswig-Holstein Research Centre Borstel, Leibniz-Centre for medicine and bio sciences State Ministry for Science, Economic Affairs and Transport of Schleswig-Holstein University of Applied Sciences Flensburg University of Flensburg University of Kiel University of Luebeck Sjælland [DK02] Business Link Sjælland Growth Forum Zealand Industrial Symbiosis Region Zealand Roskilde University Småland med öarna Atrinova [SE21] Energy Agency for Southeast Sweden Growth Gotland Kalmar Science Park Linnaeus University Municipality of Gotland Regional Council of Kalmar County Regional Council of Southern Småland Regional Development Council of Jönköping County Science Park Gotland Science Park Jönköping Science Park-systemet i Jönköpings län Sustainable Sweden Southeast The incubator in Kronoberg Videum Science Park Stockholm [SE11] County Administrative Board of Stockholm IVL Swedish Environmental Research Institute Karolinska Institutet Science Park (KISP) Kista Science City Maritime Forum

Office of Regional Planning, Stockholm County Council Stockholm Business Region Development Stockholm Innovation & Growth (STING) SU Innovation Suomi/Finland [FI] CLEEN Ltd - The energy and environment strategic centre for science, technology and innovation FIMECC Oy Finnish Metals and Engineering Competence Cluster Forestcluster Ltd Ministry of Education Research and Innovation Council Sitra Strategic Centre for Health and Well-Being Technical Research Centre of Finland The Academy of Finland The Finnish Forest Research Institute The Finnish Funding Agency for Technology and Innovation

The Ministry of Employment and the Economy TIVIT Oy Sweden [SE] Almi Industrifonden Innovationsbron Knowledge Foundation Ministry of Defence Ministry of Education and Research Ministry of Enterprise, Energy and Communications Swedish council for working life and social research Swedish Defence Materiel Administration Swedish Energy Agency Swedish Foundation for Strategic Research Swedish National Space Board Swedish Research Council The Swedish Governmental Agency for Innovation Systems The Swedish Research Council for Environment, Agricultural Sciences and Spatial Planning Syddanmark [DK03] AluCluster Business Link Southern Denmark Green Network IT Forum in South Denmark Mechatronics Cluster Denmark Plast Center Danmark Region of Southern Denmark Southern Denmark Growth Forum The innovation network RoboCluster The triange region University College Lillebælt University of Southern Denmark Sydsverige [SE22] Blekinge Business Incubator BoostHbg Ideon Innovation Ideon Science Park Krinova Science Park Lund University Medeon Media Evolution Medicon Valley Minc Mobile Heights Business Center NetPort.Karlshamn Region Blekinge Region Skåne Skåne Food Innovation Network TelecomCity University of Lund Västsverige [SE23] Automotive Sweden Brewhouse Incubator Business Region Göteborg Chalmers Innovation Espira Growth Center in Sjuhärad Gothia Science Park GU Holding Halland Regional Development Council IDC West Sweden Innovationsbron (West Sweden) Innovatum Technology Park Lindholmen Science Park MedCoast Scandinavia Region Västra Götaland Sahlgrenska Science Park Science Park Halmstad Smart Textiles SSPA Sweden University of Borås University of Gothenburg Warminsko- Agro-food Cluster Mazurskie [PL62] Centre of Green Technologies Centre of Innovation and Technology Transfer of Warmia and Mazury University

Elblag Incubator of Modern Information Technologies Elblag Technology Park Innovation Centre in Bialystok of the Polish Federation of Engineering Association - NOT Marshal Office of Warmia and Mazury Podlaski Metalworking Vluster Polish Platform for Homeland Security - Modern Security (University of Bialostok) Regional Develoment Agency of Warmia and Mazury The City Commune of Elblag University of Bialostok University of Warmia and Mazury in Olsztyn Warmia & Mazury Chamber of Craft and Entrepreneurship Zachodniopomorskie Amber Business Angel Network [PL42] Association of Socio-Economic Initiatives Chamber of Craft Small and Medium Enterprises in Szczecin Innovation Centre in Koszalin of the Polish Federation of Engineering Association - NOT Koszalin University of Technology Science and Technology Park Marshal Office of the Westpomeranian Region Polish Entrepreneurs Foundation Polish Technology Platform 'Water Transport' New Szczecin Shipyard Pomeranus Seed Capital Fund Szczeciń Science and Technology Park Technical University of Koszalin Technology Park in Koszalin The University of Szczecin West Pomerania Economic Development Association Western Pomeranian Chemical Cluster "Green Chemistry" Westerpomerania University of Technology Westerpomerania Wood and Furniture Cluster Westpomeranian Agency for Regional Development Food Cluster ICT West Pomerania Estonia [EE] Archimedes Foundation Enterprise Estonia Estonian Academy of Sciences Estonian Development Fund Estonian Science Foundation Ministry of Economic Affairs and Communications Ministry of Education and Research Research and Development Council The Estonian Patent Office The Foundation for Lifelong Learning Development Innove Climate and Energy Agency University of Tartu, Office of Research and Institutional Development Technology and Innovation Centre at Tallinn University of Technology Estonian Chamber of Commerce and Industry Ambient Sound Investments (ASI) Estonian Institute of Innovation Tallinn University, Research and Development Office Lääne-Viru College, R&D Department Institute of Baltic Studies Estonian E-Health Foundation Tartu Biotechnology Park Innovation Centre Ltd Tallinn Science Park Tehnopol Tartu Science Park Tartu Centre for Creative Industries Baltic Innovation Agency NOW! Innovations Curonia Research Invent Baltics OÜ Estonian Health Technology Cluster Industrial Export and Innovation Cluster Competence Centre for Cancer Research Estonian Nanotechnology Competence Centre Competence Centre in Electronics-, Info- and Communication Technologies

C.2 Baltic Sea clusters organisations in the European Cluster Observatory

Geographical Name of the cluster coverage Denmark Ã˜resund Environment Academy Ã˜resund Food Network Ã˜resund Science Region Alexandra Instituttet APEX Bio Med Community Biocenter East Jutland BioLogue

BioMedico Forum

BioTEAMSouth

CenSec

Center for Software Defined Radio Centre for Sub-Suppliers Centre of Health Technology Copenhagen Crossroads Cross-Border-Logistics Danish Fashion Insitute Danish Innovation Centre for Furniture and Woodvorking Industry Danish Knowledge Centre of Experience Economy Danish Maritime Authority Danish University Wind Energy Training Dansk Design Center Development Centre Aarslev Egion Environment Forum Funen Environment Network South Flagship Denmark

Foodture

Gate 21

Green Centre Green Network Green Network South Jutland Hydrogen Innovation & Research Centre ICT Forum ICT North Denmark Industrial Design Centre Innovation Centre for Bioenergy and Environmental Technology IT City Katrinebjerg IT Forum TrekantomrÃ¥det IT Growth House 5th Key2Green Knowledge Centre for Food Development Knowledge Centre for Tourism and Experience Economy Knowledge Lab Maritime Development Center of EuropÃ©

Medicon Valley Alliance

Movie Funen

Musicon Valley Denmark NorCOM Offshore Center Denmark Plastic Centre Denmark RoboCluster ScanBalt Seedland Sport Study South Funen Steel Centre TCM Denmark Teko The Danish Transport Academy The industrial symbiosis of Kalundborg The Interactive House The Maritime Growth Centre TrekantomrÃ¥det Transport Forum

Estonia Competence Centre for Cancer Research Competence Centre of Electronics and ICT Estonian Biotechnology Estonian ICT Demo Center Tallinn Media Cluster Wood building cluster of Estonia Finland Association of Finnish Maritime Industries Cleantech Cluster ClimBus DENSY EduCluster Finland Embedded Systems Farma Finn-Medi Research

FinNano

Foodwest

GIGA

HealthBIO ICT Turku IMTEC Intelligent Machines Koneteknologiakeskus Lappeenranta Innovation Living Business Logicity MASINA Merinova Energy Technology & Economy Micropolis NewPro Nordite PrizzTech Materials Technology Sara Serve

SymBio

Tampere Region Centre of Expertise

Technology Centre Teknia Teknia Agrobiotechnology The Nanotechnology Cluster Programme The TRIO Programme Tourism and Experience Management Competence Cluster Turku Touring Ubiquitous Computing Cluster Programme VAMOS Latvia Latvian IT cluster Lithuania Infobalt Lithuanian furniture cluster Sunrise valley Window to the Future Lubuski Lubuski Klaster Metalowy Meclklenburg- BalticNet-PlasmaTec Vorpommern BioCon Valley CELISCA KBR â€“ Biomaterials Rostock Kunststoffzentrum Westmeklenburg Maritime Allianz Ostseeregion Maritime Cluster in Mecklenburg-Vorpommern Nukleus

Pomorskie Å»ywnoÅ›Ä‡ zÂ Pomorza BaÅ‚tycki Klaster Ekoenergetyczny GdaÅ„ska Delta Bursztynu Gdansk Building Cluster Klaster Biotechnologii, Farmacji iÂ KosmetykÃ³w Klaster turystyczny Bory Tucholskie (Touristic Cluster Tuchola Forest) Schleswigh-Holstein Center for Product Development Cross-Border-Logistics Hightech Itzehoe Maritime Cluster in Schleswig-Holstein MedRegio schiff-gmbh

WT|SH Sweden Ã˜resund IT Ã˜resund Logistics Ã–stra SkÃ¥nes KonstnÃ¤rsgille Acusticum ADA Association for Design and Advertising Advantage Hardwood Aluminiumriket Automation Technology Cluster of West Sweden

Automotive Sweden

BioFuel Region

BioMedley.com

BIOMIME Biotech Valley Brewhouse Innovation CBioPT Center for Surface and Microstructure Technology Center of Visualization GÃ¶tebrg CERC CHARMEC CID Compare IT CPM CTT DalaBIT Fiber Optic Valley Film i VÃ¤st Filmpool Nord

Future Position X

GÃ¶teborgBIO

HÃ¤lsans nya verktyg HÃ¤lsoteknikalliansen Heavy Vehicles High Temperature Corrosion HomeCom IDEA Plant Industri 45 Industriellt Distrikt Skaraborg Innovation i GrÃ¤nsland Innovatum Internet Bay IUC Sydpoolen IUC Wermland KÃ¶ksriket Kalmar Bioscience KCEM

Livets Nya Verktyg

Livsmedel i VÃ¤st

MÃ¶belriket Furniture Kingdom Maritime Forum Mat21 MedCoast Scandinavia Microwave Road Nano Ã˜resund NIMED Packaging Mid Sweden PLUS Polymercentrum i Ã–stbo-VÃ¤stbo AB ProcessIT Innovations Processum ProNano PSCI PUCK Robotdalen

Rock City

S-SENCE

SamvÃ¤te i VÃ¤st SkÃ¤rteknikcentrum SkÃ¥nes Livsmedelsakademi SNAP

Soft Center Network Ronneby Subtopia Sustainable Sweden Southeast AB Sweden Logistics Teknocenter Telecom City Telematics Valley The Packaging Arena

The Paper Province

TrÃ¤centrum NÃ¤ssjÃ¶

TrÃ¤riket

TrÃ¤tÃ¥rtan Triple Steelix Union Wood Uppsala BIO VingÃ¥ker Energetic Science Park WURC yWood Warminsko- Klaster "Razem Cieplejâ€ Mazurskie Klaster ProducentÃ³w Okien i DrzwiÂ â€žMazurskie okna"

C.3 Policy documents and strategies in ERAWATCH-TrendChart and RIM databases Regional coverage Full title in English Denmark [DK] A Step Beyond - International Evaluation of the GTS institute system in Denmark (English documents) Action Plan for Construction Action plan of the Danish Council for Strategic Research - Research that counts Danish Council for Research Policy Annual Report 2005 - Research Policy Challenges Danish Council for Research Policy Annual Report 2006 Denmark's National Reform Programme (2005) Denmark's National Reform Programme (2008) Denmarks National Reform Programme: First Progress Report Contribution to EUs Growth and Employment Strategy (The Lisbon Strategy) Education, Training and Networking for Entrepreneurship in Denmark 2008

Entrepreneurship in the Regions in Denmark 2006

Innovation Denmark 2007-2010

Innovation Denmark 2007-2010 (english version) Innovation Denmark 2008 Innovation Strategy for the Service Industry Inside Service Innovation - Challenging Policy (English document) Nordic Innovation Monitor 2009 (English document) OECD Entrepreneurship Review of Denmark Progress, Innovation and Cohesion - Strategy for Denmark in the Global Economy Public Research Commercialisation Survey (English document) Strategy for strengthened innovation in the public sector Strategy for the GTS network 2010-2015 Strategy for the International Innovation Activities of the Enterprises The Industrial PhD - An effective tool for innovation and knowledge sharing (English document) Estonia [EE] Action Plan for Growth and Jobs 2005-2007. For implementation of the Lisbon Strategy Estonian Action Plan for Growth and Jobs 2008-2011 For implementation of the Lisbon Strategy Estonian National Development Plan for the Implementation of the EU Structural Funds. Single Programming Document 2004-2006 Estonian Strategy for Competitiveness 2009-2011 Knowledge-Based Estonia. Estonian Research and Development and Innovation Strategy 2007-2013 Knowledge-based Estonia. Estonian Strategy for Research and Development 2002-2006 National Strategic Reference Framework 2007-2013 and Operational Programmes Progress Report on the Action Plan for Growth and Jobs 2005-2007. For implementation of the Lisbon Strategy Etelä-Suomi [FI18] Competitiveness strategy of the Helsinki Metropolitan Area ERDF operational programme for Southern Finland Industry strategy of Varsinais-Suomi 2009 Innovation Strategy of the Helsinki Metropolitan Area Innovation Strategy of Uusimaa Region Germany [DE] Bund-L‰nder-Agreement on the excellence initiative of the Federal and the L‰nder governements on supporting science and research at German universities Freedom for Research in the Humanities Higher Education Pact 2020 Hightech Strategy for Germany Joint Initiative for Research and Innovation Nano Initiative Action Plan 2010 National Reform Program of Germany - "Moving forward with innovation - promoting security with change - completing German unification" New Impulses for Innovation and Growth. 6 billion Euro programme for Research and Development Research and Innovation for Germany. Results and Prospects. Research, Innovation and Technological Performance. Report 2009. White Biotechnology - Chances for new Products and environmetally sound

Processes Hovedstaden [DK01] Partnership for knowledge, growth and welfare – a business development strategy Regional Partnership agreement on growth and business development The road to a strong biotech cluster in the Capital region Itä-Suomi [FI13] Eastern Finland Programme ERDF operational programme for Eastern Finland 2007 - 2013 The Innovation Strategy of Eastern Finland The Innovation Strategy of Etelä-Savo Region 2010 -2015 Länsi-Suomi [FI19] ERDF operational programme for Western Finland Innovation strategy of Pirkanmaa region Joint Strategy for Innovation Activity 2010-2016 The Regional Technology Strategy of Central Finland 2005 - 2015 Latvia [LV] Economic Stabilisation and Growth Revival Programme of Latvia Guidelines for Development of Science and Technology for 20092013 Latvian National Development Plan for 2007-2013 Law on Research Activity National Strategic Reference Framework of Latvia 2007-2013 Programme for Promotion of Business Competitiveness and Innovation for 20072013 Sustainable Development Strategy of Latvia until 2030 (Latvia2030) Lithuania [LT] 2010-2013 implementation plan of the Lithuanian innovation strategy 2010- 2020 Biomedical and Biotechnology Joint Research Programme Concept of the Establishment and Development of Integrated Science, Studies and Business Centres (Valleys) Economy support plan Engineering and Information Technologies Joint Research Programme General National Complex Programme General National Research, Science and Business Cooperation Programme High technologies development programme for 2007-2013

Industrial biotechnology development programme for the year 2011-2013

INNO-Policy TrendChart: Innovation Policy Progress Report - Lithuania

Joint Research Programmes Preparation and Implementation

Lithuanian Innovation Strategy 2010-2020 Lithuanian Science and Technology White Paper Implementation Programme Long-Term Development Strategy of the State Long-Term Economic Development Strategy of Lithuania until 2015 Material Sciences, Physical and Chemical Engineering Joint Research Programme National General Strategy: the Lithuanian Strategy for the use of European Union Structural Assistance for 2007-2013 National Lisbon Strategy Implementation Programme for 2008-2010 National programme on development of research, technologies and innovation in the space sector for 2010-2015 Natural Resources and Agriculture Joint Research Programme Operational Programme for Economic Growth for 2007–2013 Priority Trends for Scientific Research and Experimental Development in Lithuania Priority Trends for Scientific Research and Experimental Development in Lithuania for 2007-2010 Researchers' career programme The Lithuania Long-Term Strategy for Research and Development The Programme for the Integrated Science, Studies and Business Centre (Valley) "Nemunas" The Programme for the Integrated Science, Studies and Business Centre (Valley) "Santaka" The Programme for the Integrated Science, Studies and Business Centre (Valley) "Santara" The Programme for the Integrated Science, Studies and Business Centre (Valley) „Saulėtekis“ The Programme of the Integrated Science, Studies and Business Centre (Valley) for the Development of Lithuanian Maritime Sector MECKLENBURG- ERDF operational program under the convergence objective, Mecklenburg- VORPOMMERN West Pomerania 2007-2013 [DE8] European and Baltic Sea report 2009/2010 Guidelines for technology policy Mecklenburg-West Pomerania Joint Federal-Federal State Agreement "Improvement of regional economic structure" in Mecklenburg-West Pomerania Mellersta Norrland Growth Programme Västernorrland 2008-2010 with perspective on 2013 – A

[SE32] sector programme based on the vision Västernorrland 2010 Regional Development Strategy for Jämtland´s County Regional Structural Funds Programme for Regional Competiveness and Employment in Middle Norrland– 2007-2013 Midtjylland [DK04] Innovation and growth – a business development strategy Innovation Strategy 2008-2010 Central Jutland Regional Partnership agreement on growth and business development Nordjylland [DK05] Growth and Balance – a business development strategy Growth Forum North Jutland annual report 2009 Regional Partnership agreement on growth and business development Norra Mellansverige Possibilities close to you – Regional Development Programme Gävleborg 2009- [SE31] 2013 Regional Structural Funds Programme for Regional Competiveness and Employment in North Middle Sweden – 2007-2013 The Dala Strategy - With common efforts towards 2016 Värmland is flourishing and knows no bounds – Regional Development Program 2009 - 2013 Östra Mellansverige Enterprising Västmanland – Regional Growth Progamme for Västmanland [SE12] 2009-2013 Growth Programme for the Economic Development of the Örebro Region 2009- 2013 Regional Action Plan for Innovations - Örebro Region Regional Structural Funds Programme for Regional Competiveness and Employment in East Middle Sweden – 2007-2013 The Sörmland Strategy – a strategy for sustainable growth and development in Sörmland Övre Norrland R & D Co-operation in the EU-arena, between Västerbotten County and [SE33] Norrbotten County Regional Growth Programme for Norrbotten Regional Structural Funds Programme for Regional Competitiveness and Employment in Upper Norrland – 2007-2013 Västerbotten County - Regional Growth Strategy 2010 Pohjois-Suomi ERDF operational programme for Northern Finland [FI1A] Oulu inspires - Innovation Strategy 2007 - 2013

Poland [PL] Act of 30 April 2010 on the Principles of Financing Science Act on some forms of supporting innovation activities Building upon knowledge: Science reform for Poland's development National Reform Programme for 2008-2011 National Scientific Research and Development Programme Operational Programme Human Capital, 2007-2013 Operational Programme Innovative Economy, 2007-2013 Partnership for Knowledge

Poland 2030 - Development Challenges

Science Strategy in Poland until 2015

Strategy for the development of Higher Education in Poland until 2020

The Implementation Document of the National Reform Programme 2008-2011 Pomorskie [PL63] Complement Document of the Pomorskie Regional Operation Programme for years 2007-2013 Regional Development Strategy Regional Innovation Strategy SCHLESWIG- Baltic Sea Report 2010 HOLSTEIN [DEF] ERDF operational programme under the competitiveness and employment objective, Schleswig-Holstein 2007-2013 Programme for the Future of the Economy - Schleswig-Holstein Programme for the Future of the Labour Market - Schleswig-Holstein Report of the budget structure commission Sjælland [DK02] A new Strategy for region Zealand Growth Forum Zealand’s business development strategy Regional Partnership agreement on growth and business development Småland med öarna A future of opportunities - The Regional Development Programme up to 2020, [SE21] Jönköping County Meeting place Södra Småland – Regional Development Programme, a strategy for Kronoberg county Regional Structural Funds Programme for Regional Competitiveness and Employment in Småland and the Island – 2007-2013 Stockholm [SE11] Regional Strategy for Entrepreneurship in Stockholm County 2007-2013 Regional Structural Funds Programme for Regional Competitiveness and Employment in Stockholm – 2007-2013 RUFS 2010 - Regional Development Plan for the County of Stockholm

SUOMI / FINLAND National Innovation Strategy [FI] Suomi/Finland [FI] Education and Research 2003-2008: Development Plan Education and Research 2007-2012: Development Plan Evaluation of the Finnish National Innovation System Government Programme of Prime Minister Matti Vanhanen's second Cabinet Government Resolution on the Structural Development of the Public Research System Government statement on Innovation Policy Government Strategy Document 2005 Government Strategy Document 2007

Knowledge, innovation and internationalisation

Review2008

Science, Technology, Innovation

Strategy for the internationalisation of Finnish higher education institutions The Lisbon Startegy for Growth and Jobs - The Finnish National Reform Programme 2005-2008 The Lisbon Strategy for Growth and Jobs - The Finnish National Reform Programme 2005 - 2008: Annual Progress Report (2006) The Lisbon strategy for growth and jobs 2008-2010 - The Finnish National Reform Programme Sweden [SE] A national strategy for regional competitiveness, entrepreneurship and employment 2007-2013 Financing strong research environments - an international prospect Government bill 2004/05:80 Research for a Better Life Innovative Sweden - A strategy for growth through renewal New World - New University Sweden's reform programme for growth and employment Skr. 2005/06:23 VINNFORSK - VINNOVA's proposal to improved commercialisation and increased returns in growth of research investments at universities Syddanmark [DK03] Business development strategy 2007-2012 Growth Account: Growth and prosperity Regional Partnership agreement on growth and business development Sydsverige [SE22] Growth Blekinge - Regional growth programme for Blekinge 2008-2013 Regional Development Programme for Skåne 2009-2016 Regional Structural Funds Programme for Regional Competitiveness and Employment in Skåne-Blekinge 2007-2013 Skåne´s Innovation Capacity - An action plan for a more innovative Skåne Västsverige [SE23] Growth Programme for Halland 2007-2010 Growth Programme for Västra Götaland 2008-2013 Regional Policy for global impact – The RTD & Innovation strategy of Region Västra Götaland Sweden Regional Structural Funds Programme for Regional Competitiveness and Employment in West Sweden – 2007-2013 Warminsko- Analysis of Implementation of the RIS in Warmia and Mazury Mazurskie [PL62] Complement Document of Warmia and Mazury Regional Operational Programme (2007-2013) Regional Development Strategy Regional Innovation Strategy until 2020 Zachodniopomorskie Complement Document of Westpomeranian Voivodship Regional Operational [PL42] Programme (2007-2013) Development Strategy of the Westpomeranian Voivodship Regional Innovation Strategy in Westpomeranian Voivodship

C.4 Research and innovation measures in the RIM database Country/Region Title of Measure Duration: Duration: From To Mecklenburg- Patent and License Fund Mecklenburg-West 2003 Pomerania Vorpommern [DE8] Promotion of science and research 1999 Promotion of scientific excellence in 2006 2010 Mecklenburg-West Pomerania Support of research, development and 2008 2013 innovation Support of technology-oriented networks 2008 2013 TIP - The new programme for new business 2007 founders (transparent innovative tailored) VentureCup-MV 2011 2002 Schleswig-Holstein Norgenta Life Science Agency 2004 2004 [DEF] Seed- and Start-Up-Fund Schleswig-Holstein 2007 2010 Support for Environmental Innovations (UI) 2008 2013

Support for Research, Development and 2009 2013 Innovation in Business Enterprises (BFEI) Support for Research, Development and 2008 2013 Technology Transfer (FET) Support Programme Higher Education, 2010 2012 Business, Transfer III (HWT III) Hovedstaden [DK01] Growth Forum Initiatives (Capital region) 2007 Sjælland [DK02] Growth Forum Initiatives (Zealand region) 2007 Syddanmark [DK03] Growth Forum Initiatives (Southern Denmark) 2007 Midtjylland [DK04] Growth Forum Initiatives (Central Jutland) 2007 Nordjylland [DK05] Growth Forum Initiatives (Northern Jutland) 2007 Zachodniopomorskie Business competition of the Marshal of the [PL42] Westpomeranian voivodship

R&D Infrastructure 2007 2013 SME investments in new technologies 2007 2013

Specialist advisory services to SMEs 2007 2013 Support to the innovation institutions of 2007 2013 business environment Warminsko- Increasing competitiveness of enterprises 2007 2013 Mazurskie [PL62] Increasing potential of business intermediary 2007 2013 organisations Regional innovation strategies 2007 2013 Pomorskie [PL63] Financial instruments for SMEs 2007 2013

Innovative solutions in SMEs 2007 2013 Micro, Small and Medium-Size Enterprises 2007 2013 Regional innovation strategies 2007 2013 Regional network of transfer of innovative 2007 2013 solutions Systemic Support to Entrepreneurship 2007 2013 Stockholm [SE11] Creative Business Region Stockholm 2009 2011 Entrepreneur STHLM 2008 2011 Innovation Stockholm 2008

Karolinska Institute Innovation 1996 1996

Powerhouse Life Science in Stockholm Life 2010 2013 Solna-Stockholm STING - Stockholm Innovation and Growth 2001 Stockholm MedTech Growth 2009 2012 Strengthening Stockholm's ICT-cluster – Kista 2009 2011 Science City Östra Mellansverige Business Science Arena 2009 [SE12] Meal Centre (pilot study) 2010 2010 New Tools for Health 2004 2013

Processes and Relations in Innovative 2008 2010 Environments (PRIM) Robot Valley 2004 Uppsala Bio 2003 2012 Småland med öarna Dare-Grow-Win 2008 2010 [SE21] Dynamism in Småland’s Clusters (DISK) 2008 2010 Functional analysis of the innovation system of 2010 2010 Småland/Blekinge

Knowledge and Innovation in Småland (KIS) 2008 2011 Småland’s and Gotland’s Incubators 2.0 2008 2010 Entrepreneurship Fund South Sweden 2009 2014 ICT Blekinge - BICT 1 2008 2011 Innovator Skåne 2010 2010 Media Evolution 2009 2011 Medicon Valley Alliance 1997 1997 Mobile Heights Skåne Food Innovation Network 2003 2012 Swedish Model for Clean Growth 2007 2010 Västsverige [SE23] Growth Halland 2008 2011

HINT – (Sustainability Innovation Growth) 2008 2010

Industrial Dynamics 2008 2010

InMotion 2009 2010 Smart Textiles 2008 2017 Social Entrepreneurship 2009 2012 Norra Mellansverige Fiber Optic Valley 2001 2011 [SE31] Future Position X 2007 2007 High Voltage Valley 2005

SLIM – System Management for Innovative 2007 2013 Platforms and Cluster Organisations in Northern Central Sweden The Packaging Arena 2002 2002 Triple Steelix 2004 2004 Mellersta Norrland Åkroken Science Park [SE32] Fibre Science and Communication Network 1999 Innovation Office ‘Four-leaf clover’ 2010 2011

MIUN Innovation 2009 2009

Packaging Mid Sweden 2008 2011 Peak Innovation 2008 2017 Processum Biorefinery Initiative Övre Norrland Biotechnology - Berries 2007 2010 [SE33] Electronic System – a regional Innovation 2008 2011 System - ESIS Innovation sluice Västerbotten 2010 2013

Krenova 2008 2010

ProcessIT Innovations 2002 2013 TräCentrum Norr (Wood Centre North) 2007 2010 Umeå Biotech Incubator 2003 2013 Suomi / Finland [FI] Regional cohesion & competitiveness 2010 2013 programme COCO Tekes programmes 2010 2010 Itä-Suomi [FI13] ERDF operational programme for Eastern 2007 2013 Finland 2007-2013 The Development Programme for Technology 2011 2015 Industry in North Karelia 2015 Etelä-Suomi [FI18] ERDF operational programme for Southern 2007 2013 Finland 2007-2013 The Centre of Expertise Programme (OSKE) 1995 2013 Creative Tampere -programme 2006 2011 ERDF operational programme for Western 2007 2013 Finland 2007-2013 Länsi-Suomi [FI19] Functioning Labour Markets - skilled workers 2009 2013 and jobs - Development Programme 2009 - 2013 Research and Innovation Programme of Higher 2007 2013 Education Institution Network of South Osthrobothnia Pohjois-Suomi ERDF operational programme for Northern 2007 2013 [FI1A] Finland 2007-2013

C.5 Research and innovation measures in TrendChart and ERAWATCH database Country/ Region Name of the support measure Denmark 25 % Tax Scheme: Taxation of the Salaries of Well-paid Foreigners and Foreign Researchers Act on technology transfer on Public Research Institutions Advanced Technology Group - GTS Better Innovation Business Development Finance - The Growth Foundation Centres of Excellence Energy Technology, Development and Demonstration Programme (EDDP) Fund for employee-driven innovation in the public sector

Gazelle Growth programme

Graduate Schools

Industrial PhD initiative

Innovation center for eBusiness - IBIZ Innovation Consortiums Innovation packages (international consultancy) Interdisciplinary Research programme on the correlation between food, nutrition and health Investments in work force saving technologies Knowledge pilots Knowledge voucher (small scale innovation projects) New Knowlege for the Construction Industry Niels Bohr Visiting Professorship Pre-project grant for the 7th EU framework programme Proof of Concept Regional innovation agents Regional technology centres Research voucher for SMEs SPIR - Strategic Platforms for Innovation and Research

Strategic research in education and creativity

Strategic research in strategic growth technologies

Strategic research programme for environmentally sustainable energy and

energy production

Sustainable transport and infrastructure The ‘double-up’ initiative The Danish National Advanced Technology Foundation The Innovation Act (food) The prevention fund - new technology to prevent disabilities Estonia Business incubator programm Cluster development programme Competence centre programme Competence Centres Development of collaboration and innovation in HEIs Doctoral Studies and Internationalisation Programme “DoRa” Estonian Development Fund Innovation vouchers

Modernisation of R&D apparatus and equipment

National programme ''Estonian language and cultural memory 2009-2013''

National programme "Language Technology Support for the Estonian Language

2006–2010" (NPELT)

Product development Programme (earlier title R&D Financing Programme) Research and development institutions'' infrastructure development programme Researcher mobility programme MOBILITAS Support for the Involvement of Innovation Staff Supporting the investments of infrastructure of test and semi-industrial laboratories Targeted financing of R&D institutions TeaMe Technology investment support in industrial enterprises Technology investment support in industrial enterprise The Centres of Excellence of the Estonian Science Programme The SPINNO Programme

Finland BioRefine 2007 -2012 Boat Programme 2008 -2011 Built environment Centre of Expertise Programme (OSKE) Centres of Excellence (CoE) Computational Science Research Programme - LASTU Concepts of Operations 2007 -2011 Digital Product Process 2008-2012

Environmental, Societal and Health Effects of Genetically Modified Organisms

(ESGEMO)

Finland Distinguished Professor Programme (FiDiPro)

Finnish Innovation Centres - FinNode

Finnvera''s financial services for start-ups and micro-enterprises FinnWell - Healthcare programme 2004 – 2009 Foundation for Finnish Inventions'' funding for inventions Fuel Cell 2007 -2013 Functional Materials 2007 -2013 Funding for purchase of innovation services Funding scheme for young innovative companies GIGA Converting Networks 2005 -2010 Graduate schools system INNOFINLAND Innovations in social and healthcare services Intelligent, resource-efficient production technologies (EffTech) InvestorExtra Liito - Innovative Business Competence and Management 2006-2010 MASI - Modeling and simulation 2005-2009 NewPro - Advanced Metals Technology - New Products 2004 - 2009

NORDITE 2005-2010

Pharma - Building Competitive Edge 2008–2011

Reseach Programme on Substance Use and Addiction (ADDIKTIO) Research Programme on Business Know-how (LIIKE 2) Research Programme on NanoScience (FinNano) 2006-2010 Research Programme on Neuroscience (NEURO) 2005-2009 Research Programme on Photonics and Modern Imaging Techniques Research programme on Power in Finland (VALTA) 2007–2010 Research Programme on Sustainable Production and Products (KETJU) Research Programme on The Future of Work and Well-being Responding to Public Health Challenges (SALVE) Safety and security 2007-2013 Sapuska - Added Value for International Food Markets 2009-2012 Seed Fund Vera Ltd Serve - Pioneers of Service Business 2006-2013 SISU 2010 - Innovative Manufacture 2005 - 2009 Spaces and Places Sustainable community 2007-2012

Sustainable energy

SymBio - Industrial Biotechnology 2006-2011

The Finnish Workplace Development Programme Tykes The Millennium Technology Prize The Research Programme on Nutrition, Foods and Health (ELVIRA) 2006-2010 The Research Programme on the Application of Information Technology in Mechanical, Civil and Automation Engineering 2005-2009 (KITARA) Tourism and Leisure Services 2006-2009 TRIO Programme Ubicom - Embedded ICT 2007-2013 Ubiquitous computing and diversity of communication (MOTIVE) VAMOS - Value Added Mobile Solutions 2005-2010 Venture Cup Finland Verso - Vertical Software Solutions 2006-2010 Water Programme 2008-2012 Germany Action Programme Environment and Health BioFuture Central Innovation Programme SME Centres for Innovation Competence Climate2 - Research for Climate Protection and Protection from Climate Impacts Economic Sciences for Sustainability Environmental Specimen Bank (ESB) ERP Innovation Programme

EXIST - Start-ups from Science ExistGo-Bio Framework Concept for the Production of Tomorrow Framework Programme "Biotechnology - Using and Shaping its Opportunities" Framework Programme "Research for Sustainability" Framework Programme Microsystems 2004-2009 Framework Programme: Materials Innovations for Industry and Society (WING) Functional Nutrition Research

Future Construction

GenoMik Plus

GeoTechnologies

Health Research: Scientific Research for the people High-tech Start-up Fund ICT 2020 IGF - Promotion of Joint Industrial Research (incl. ZUTECH) Innovation Alliances Innovative Regional Growth Poles IT Research 2006 Junior Research Groups in Socio-ecological Research Knowledge for Decision-Making Processes Megacities of Tomorrow Methods to replace animal experiments Nanotechnology National Aeronautics Research Programme National Network "Computational Neuroscience" Networks of Competence Next Generation Solar Energy Technology

Optical Technology

Patent Information Centres and Thematic Information Centres

Research Bonus Research for Civil Security Road Construction Research Programme SIGNO - Protection of Ideas for Commercial Use SME innovative Socio-ecological Research Sustainable Forestry Technology Venture Capital Programmes The Humanities in the Social Dialogue TOP - Technology oriented visiting and information programme Top Cluster Competition Latvia Attraction of highly qualified workforce Attraction of Human Resources to Science Basic and Applied Research Projects Programme Energy State Research Programme Enhancing motivation for innovation and business start-up Export and innovation award High value added investments Investments in development of micro, small and medium-sized companies in specially supported territories

Pre-seed support for innovative business ideas

Promotion of science competitiveness programme

State research programme " Information technologies"

State research programme "Agrobiotechnology" State research programme "Forestry and wood processing technology" State research programme "Latvian studies (Letonica) - culture, language and history" State research programme "Material science" State research programme "Medical science" State research programme "Organic synthesis and biomedicine" State research programme “Environmental research” Support for development of innovation centres and business incubators Support for development of new products and technologies Support for establishing industrial property rights Support for introduction of new products and technologies into production Support for Joint Research Projects Support for science and research Support to international R&D collaboration (EUREKA) Support to liaison offices for technology transfer Support to market oriented research

Support to SME venture capital Support to the implementation of doctoral programmes and postdoctoral research Lithuania Assistant - 1 Assistant - 2 Assistant - 3 Controlling fund Development of computer literacy skills Development of entrepreneurial skills Direct support for IPR protection in enterprises E-business LT

High technologies development programme

Idea LT

Improvement of knowlegde about science and technologies among pupils and

youth and support to equal rights in science

Improvement of the Qualifications and Competencies of Scientists and Researchers (scientific databases, e-documents) Industrial biotechnology development programme Inogeb LT-1 Inogeb LT-2 Inoklaster LT Inoklaster LT+ Intellect LT+ Invest LT Leader LT Lithuanian National Lisbon Strategy Implementation Programme Partial compensation of SME''s credit interests Process LT Programme of Second Stage for the Implementation of the Lithuania Long- Term Strategy for Research and Development (2006–2009) R&D Quality and Training of Experts Social responsibility of enterprises

Strengthening of the General Science and Studies infrastructure

Support for Business Missions

Support for the devlopment and participation in technology platforms

Support for the participation of foreign experts in the events, organised in Lithuania Support of scientists and researchers mobility and students scientific work Support to Priority Research and Experimental Development Trends in Lithuania The Creation of Infrastructure, aimed at the Improvement and Dissemination of Knowledge about R&D, Technologies and Innovations The Creation of National Open Source Scientific Communication Centre The Development of the High Level Research Centres and Competence Centres The improvement of human resources in enterprises The Preparation of R&D Infrastructure Development Projects The Programme of Industrial Biotechnology Development in Lithuania for 2006-2010 The Single Programming Document of Lithuania for 2004-2006. Measure 1.5. “Development of Infrastructure of Labour Market, Education, Vocational Training, Research and Study Institutions and Social Services” The Single Programming Document of Lithuania for 2004-2006. Measure 3.1 “Direct support to business” Poland Creation of the system facilitating investments in SMEs Creator of innovativeness Development of centres with high research potential Development of R&D personnel qualifications and raising awareness of the role of science in economic development Development of workforce and enterprises in regions Fiscal incentive Initiating innovation activities Innovation Voucher

Investment relating to science IT infrastructure

Investments related to R&D activities within enterprises

Lifelong learning

Management of intellectual property rights New investments with high innovation potential NewConnect Patent Plus Polish Product of the Future

Status of R&D Centres Strengthening and developing HEIs academic potential as well as increasing the number of graduates at courses of strategic importance for the development of knowledge-based economy Strengthening potential of science staff Support to applied research projects undertaken by science institutions Support to cooperation linkages at national level Support to innovation centres Support to networks of intermediary organisations providing innovation services at national level Support to risk capital funds

Support to scientific research for building the knowledge-based economy

Support to the creation of joint research infrastructure of science entities

Support to the implementation of R&D results Support to the system for the adaptability of personnel Technological initiative Technology credit Transfer of knowledge Sweden Berzelii Centres Biomedical Engineering for Improved Health Cluster Programme Company graduate schools Company/ university research profiles Competence development in industry Designed Materials including Nanomaterials Environment-driven markets

FAS Centres

FAS Post-doc grant

Forest research programme

Global Links for Strong Research and Innovation Milieus Grant for postdoctoral position in Sweden Green Nano Human Proteome Resource (KAW) Industrial Biotechnology Innovation financing Innovation in food Innovations for Future Health Institute Excellence Centres National Aeronautical Research Program ProEnviro Regional Development Programme Research & grow Research profiles Research- and Postgraduate Programme (Smaforetags- och industridoktorandprogrammet) Solar Energy for hydrogen production (KAW)

Strategic Research Centres

Sustainable Renovation

SWECIA - Mistra SWEdish research programme on Climate, Impacts and Adaptation Swedish Norwegian business cooperation The Key Actor''s Programme The Linnaeus Grant The National Incubator Programme Vehicle and traffic safety Venture Cup VINN Excellence Centre VINN NU VINN-Verification VINNMER VINNPRO VINNVÄXT - Regional growth through dynamic innovation systems Visualisation research programme

Appendix D Transnational co-operation in the BSR

D.1 Baltic Sea Region Programme 2007-13: fostering innovation sub-theme projects Project Project Name Lead Partner Acronym Best Agers Best Agers -professionals in their primes to foster Wirtschaftsakademie business and skills development in the Baltic Sea Schleswig-Holstein GmbH DE Region BaltFood BaltFood - The BSR Food Cluster: Innovation and Wirtschaftsförderung Lübeck Competitiveness in Action GmbH DE Baltic Fashion Promoting the innovative Baltic Fashion industry throughout the Baltic Sea Region BalticSupply Interregional SME Supply Clusters along the Senator für Wirtschaft und Northeast Corridor Häfen DE BaSIC Baltic Sea Innovation Network Centres WISTA-MANAGEMENT GMBH DE BONITA Baltic Organisation and Network of Innovation Universität Bremen DE Transfer Associations BSHR BSHR HealthPort - Baltic Sea Health Region - HealthPort Business acceleration support and training bridging innovative SMEs and health care organisations to strengthen BSR health economy BSR InnoReg Strengthening Innovation Governance in Baltic Non- Suomen Itämeri-instituutti FI metropolitan Regions through Transnational Cooperation BSR QUICK BSR QUICK - Qualification, Innovation, Cooperation Hanse-Parlament e.V. DE and Keybusiness for Small and Medium Enterprises in the Baltic Sea Region BSR_CBP Capacity Building Programme on Trans-National Trekantsområdet DK Cluster and Innovation Systems in the Baltic Sea Region COOL Bricks - COOL Bricks - Climate Change, Cultural Heritage & Energy Efficient Monuments FM - FIRST Driving BSR regional development by innovating Filmförderung Hamburg MOTION the high-skill growth sector "creative/AV industry" Schleswig-Holstein GmbH DE (FM) IBI Net IBI Net - "Intercountry Business Incubators’ Riga Planning Region LV Network" ICT for Health ICT for Health - Strengthening social capacities for the utilisation of eHealth technologies in the framework of ageing population JOSEFIN Joint SME Finance for Innovation Investitionsbank Berlin (IBB) DE Longlife Longlife - Sustainable, energy efficient and resource Technische Universität Berlin saving residential buildings with consideration of DE unified procedures and new and adapted technologies MIN- MIN-NOVATION Mining and Mineral Processing NOVATION Waste Management Innovation Network PlasTEP - Dissemination and fostering of plasma based Technologiezentrum technological innovation for environment protection Fördergesellschaft mbH in BSR Vorpommern DE REMOWE Regional Mobilizing of Sustainable Waste-to-Energy Mälardalens högskola SE Production SPIN Sustainable Production through Innovation in Small Umweltbundesamt (UBA) DE and Medium sized Enterprises StarDust StarDust - The Strategic Project on Trans-national Commercial Activities in Research & Innovation, Clusters and in SME-Networks URBAN URBAN CREATIVE POLES - Development and CREATIVE Promotion of Creative Industry Potentials in POLES Medium-Sized Cities of the Baltic Sea Region Source: Baltic Sea Region Programme 2007-2013 database

D.2 INTERREG IV C - innovation & the knowledge economy sub-theme – number of BSR organisations per project Sub -Theme • Project Name Number of BSR organisations participating

Employment, human capital • Brain Flow 2 and education • CREATOR 2

• DART 2 • Gender4Growth 1 • PADIMA 1 • PEOPLE 1 • SolidarCity 1 • UNICREDS 6 • WINNET 8 11 • B2N 3 Entrepreneurship and SMEs • CITIES 2

• CLUSNET 3 • CREA.RE 2 • Creative Growth 6 • CREATIVE METROPOLES 5 • ENSPIRE EU 3 • ENTREDI 2 • EuroPROC 1 • ICER 1 • ICHNOS PLUS 1 • IMAGEEN 1 • NEEBOR 6 • POOLING4CLUSTERS 1 • Robinwood PLUS 1

• RURALAND 2

• SEE 4

• YES 3 Innovation, research and • ChemClust 1 technology development • CLIQ 4

• DISTRICT+ 1 • ECREIN+ 1 • ERIK ACTION 1 • ERMIS 2 • FRESH 4 • I4W 1 • INNOHUBS 2 • INNOPOLIS 2

• IPP 1 • MINI EUROPE 1 • MKW 3 • RAPIDE 4 • SCINNOPOLI 1 The Information Society • DE-LAN 1 • DLA 3 • eCitizen II 4 • EVITA 4 • ICT-VN 1 • IMMODI 2 • OSEPA 2 • PIKE 1 • RTF 3

Source: INTERREG IV C database, data extracted 3 February 2011.

D.3 Baltic Sea Region organisations involved in ERA-NET projects Organisation Name Country Regional Coverage Academy of Finland Finland National Agency for International Science and Lithuania Not specified Technology Development Agency for Renewable Resources Germany National Alfred Wegener Institute for Polar and Marine Germany Not specified Research Application Center Oberpfaffenhofen Germany Not specified Archimedes Foundation Estonia National Association of Finnish Marine Industries Finland National Bavarian Ministry of Economy, Infrastructure, Germany Not specified Transport and Technology BIA Bremen Innovation Agency Germany Not specified BONUS - Baltic Organisations Network for Finland International Funding Science EEIG Center for Innovation and Technology in Germany Not specified Northrhine-Westfalia Central Association for occupational safety, Germany National health protection, accident insurance Central Office of Metrology Estonia National Centre for Metrology and Accreditation Finland National Danish Fundamental Metrology Ltd Denmark National Danish Maritime Authority Denmark National Danish Ministry of Foreign Affairs - Denmark National Department for Technical Advisory Services Danish Ministry of the Environment Denmark National Danish Ministry of Transport Denmark National Danish National Advanced Technology Denmark National Foundation Danish Polar Centre Denmark Not specified Danish Road Directorate Denmark National Danish Water Forum Denmark National Elytra Denmark National Energinet.dk Denmark National Enterprise Estonia Estonia National Estonian Academy of Sciences Estonia National Estonian Ministry of Culture Estonia Not specified Estonian Police Forensic Service Centre Estonia National Estonian Science Foundation Estonia National Estonian Ministry of Education and Research Estonia National EURAMET Germany International European Organisation for Astronomical Germany Not specified Research in the Southern Hemisphere Federal Agency for Agriculture and Food Germany National Federal Environment Agency Germany National Federal Highway Research Institute Germany National Federal Institute for Geosciences and Natural Germany National Resources Federal Institute for Occupational Safety and Germany National Health Federal Institute for Risk Assessment Germany Not specified Federal Ministry of Consumer Protection, Germany National Food and Agriculture Federal Ministry of Economics and Labour Germany National Federal Ministry of Economics and Technology Germany National Federal Ministry of Education and Research Germany National Federal Ministry of Labour and Social Affairs Germany National Federal Ministry of the Environment, Nature Germany National Conservation and Nuclear Safety Federal Ministry of Transport, Building and Germany National Urban Affairs Federal Office for Building and Regional Germany National Planning Federal Office for Consumer Protection and Germany Not specified Food Safety Finish Cancer Registry Finland National Finnish Consulting Group International Finland International

Finnish Environment Institute Finland National Finnish Funding Agency for Technology and Finland National Innovation Finnish Institute of Occupational Health Finland National Finnish Ministry of Social Affairs and Health Finland National Finnish Ministry of Trade and Industry Finland National Finnish Road Administration Finland National Finnish Vehicle Administration Finland National Finnish Work Environment Fund Finland National Forest cluster Ltd Finland National Foundation for Strategic Environmental Sweden National Research Fraunhofer Society Germany National German Aerospace Centre Germany National German Development Institute Germany National German Federal Foundation for the Germany National Environment German Federation of Industrial Research Germany National Associations German Foundation of Organ Transplantation Germany National German Police University Germany National German Research Foundation Germany National German Social Accident Insurance Germany Not specified Helmholtz - Community of German Research Germany National Centres Helsinki Institute of Physics Finland National IFOK GmbH - Institute for Organizational Germany Not specified Communication INNtex Innovation Network Textile Germany Regional Institute and Outpatient Clinic for Germany National Occupational, Social and Environmental Medicine Institute for Quality and Efficiency in Health Germany Not specified Care Institute of Health and Labour NRW Germany Regional International Bureau of BMBF Germany National International Centre for Research in Organic Denmark National Food Systems Julius Kuhn Federal Research Institute for Germany Not specified Cultivated Plants Karlsruher Institut für Technologie Germany National Klaipeda University Lithuania Not specified Latvian National Academy of Sciences Latvia National Latvian Science Council Latvia National Latvian State Institute of Agrarian Economics Latvia National Leibniz-Institute for Agricultural Engineering Germany Regional Potsdam-Bornim Lithuanian Road Administration Lithuania National Machine Technology Centre Turku Ltd Finland Not specified Ministry for Foreign Affairs Finland National Ministry of Agriculture Estonia National Ministry of Agriculture Latvia National Ministry of Agriculture and Forestry Finland National Ministry of Agriculture of the Republic of Lithuania National Lithuania Ministry of Agriculture of the Republic of Lithuania National Lithuania Ministry of Defence Sweden National Ministry of Economic Affairs and Energy Germany Regional Ministry of Economics Latvia National Ministry of Economics and Communication Estonia National Ministry of Education and Science Latvia National Ministry of Education and Science of the Lithuania National Republic of Lithuania Ministry of Employment and the Economy Finland National Ministry of Enterprise, Energy and Sweden National Communications Ministry of Environment Latvia Not specified Ministry of Family and Consumer Affairs Denmark National Ministry of Food, Agriculture and Fisheries Denmark National

Ministry of Health of Republic of Lithuania Lithuania National Ministry of Innovation, Science, Research and Germany Regional Technology North Rhine-Westfalia Ministry of Innovation, Science, Research and Germany Not specified Technology of North Rhine-Westphalia Ministry of Labour, Health and Social Affairs Germany Not specified of North Rhine-Westphalia Ministry of Science and Research Germany Regional Ministry of Science, Technology and Denmark National Innovation Ministry of the Environment Finland Not specified Ministry of the Interior - Police Department Finland National Ministry of Traffic, Energy and Regional Germany Regional planning North Rhine-Westphalia Ministry of Transport and Communications Finland National Ministry of Transport of the Republic of Latvia Latvia Not specified National Archives Sweden Not specified National Board of Health Denmark National National Centre for Research and Poland National Development National Food and Nutrition Institute Poland Not specified National Food Institute - Technical University Denmark Not specified of Denmark National Institute for Working Life Sweden National National Metrology Institute Germany National National Police Department Denmark Denmark National National Research Centre for the Working Denmark National Environment Nofer Institute of Occupational Medicine Poland National Nordic Council of Ministers Denmark Not specified Nordic Forest Research Co-operation Finland Not specified Committee Nordic Optical Telescope Scientific Association Sweden Not specified Plant Protection Institute Poland Not specified Police Academy of Latvia Latvia National Polish Academy of Science Poland National Potsdam Institute for Climate Impact Germany National Research Project Management Agency for Production Germany National and Manufacturing Technologies Project Management DESY Germany National Project Management GSI Germany National Project Management Juelich / Research Germany National Centre Juelich Region Västra Götaland Sweden Regional Regional Oncologic Centre Board - Upsala Sweden National Örebroregionen Research Centre of Agricultural and Forest Poland National Environment Research Council Sweden National Research Council for Production and Denmark National Technology Sciences Research Institute of Pomology and Poland National Floriculture in Skierniewice Saxon State Ministry of the Environment and Germany Regional Agriculture Science Council of Lithuania Lithuania National Sea Fisheries Institute in Gdynia Poland National Senator for Economy and Ports Germany Not specified Silesian University of Technology Poland National Society for Innovative Employment Promotion Germany Not specified Spinverse Capital and Consulting Finland National State Inspection for Heritage Protection Latvia National Swedish Construction Sector Innovation Sweden National Centre Swedish Council for Working Life and Social Sweden National Research Swedish Defence Research Agency Sweden Not specified Swedish Energy Agency Sweden National Swedish Environmental Protection Agency Sweden National Swedish Governmental Agency for Innovation Sweden National

Systems Swedish Institute of Agricultural and Sweden National Environmental Engineering Swedish Maritime Administration Sweden National Swedish Meteorological and Hydrological Sweden National Institute Swedish National Police Board Sweden National Swedish National Roads Administration Sweden National Swedish Rail Administration Sweden National Swedish Research Council for Environment, Sweden National Agricultural Sciences and Spatial Planning Technical Research Centre of Finland Finland National Technical Research Institute of Sweden Sweden National Technical University of Lodz Poland National Tetraplan A/S Denmark National TÜV Rheinland Consulting GmbH Germany National University of Tartu Estonia National University of Technology Estonia Not specified Värmeforsk Sweden National VDI Technologiezentrum GmbH Germany National Vilnius Gediminas Technical University Lithuania National Warsaw University of Technology Poland National WoodWisdom-Net Project Secretariat Finland International Wrocław Regional Development Agency SA Poland Not specified Source: ERA-NETS database, data extracted 3 February 2011

D.4 Baltic Sea Region organisations involved in Regions of Knowledge

Project acronym Theme 1 of the call Targeted field/Sector Country of partner BioMob Enhancing the Socio-economic sciences Denmark [DK] sustainable use of and humanities natural resources and of the natural and man- made environment Bridge-BSR Maximising the benefits of research infrastructures Denmark [DK] for regional economic development Estonia [EE] Socio-economic sciences and humanities Germany [DE] Latvia [LV]

EMSAC Transnational Food, agriculture and Sweden [SE] cooperation between fisheries regional research-driven clusters INRES Maximising the benefits Environment (including Denmark [DK] of research climate change) infrastructures for regional economic development iRegions Maximising the benefits of research infrastructures Sweden [SE] for regional economic development Estonia [EE] ICT and information society

REDICT Bringing the benefits of ICT and information Denmark [DK] research to SMEs society STInno Transnational Environment (including Sweden [SE] cooperation between climate change) regional research-driven clusters TOUREG Bringing the benefits of Services Sweden [SE] research to SMEs TRANS REG NCP Trans-national co-operation among NCPs Latvia [LV] Lithuania [LT] n/a

Appendix E Evidence on ERDF impact

E.1 Summary of DG REGIO innovation policy reports for the 2007-2013 for Baltic Countries

Denmark • Innovation, • National • Strong • 82.2 % (209m) of • 1st priority: boosting • Only eight • 4 cross • Widen the knowledge sharing government sets coherence total ERDF in the applied research and projects have border co- scope of the and knowledge up the strategic between the period 2007-2013 is product development been operation evaluations development framework objectives of the supporting (€107m) completed and programmes • Develop • Creation and • Danish Growth ERDF and the innovation activities • 2nd priority: have • 2 evaluations development of new Council is regional knowledge transfer conducted a transnational that deal with business appointed to strategies of the and support to final ones results and six regions evaluation • Application of new advise on innovation poles and impacts in a technologies strategy and • Each of the six clusters (€68m) • These methodological administer the Danish regions • 3rd priority: evaluations and consistent implementation carries out their innovation friendly show a strong way of the national own innovation environment (€33m) focus on the • Bring the policies policy (e.g. primary evidence from • Growth Forums North Jutland: output of the the output-level to implement New products respective of the projects the respective and business performance, to the aggregate regional models, recipients result level strategies for the development of mostly development of new technology, conduct the trade and Increase work evaluations industry places) themselves.

Estonia • Competitive quality • Single NUTS II • No regional • 22,2% of total ERDF • 1st priority: Boosting • Recent • Central Baltic • Concept of and increased • Objective 1 priorities in R&D resources for applied research evaluations INTERREG programmes intensity of R&D, region and innovation innovation (€668 m) (€319m) call for greater IV remains fuzzy policy, nd emphasis on • Innovative • Top-down • 2 priority: • Estonia and • The enterprises to create • Innovation- knowledge transfer the enterprise Latvia co- administrative approach in the sector (vis-à-

Country National Innovation Governance Regional ERDF Overall ERDF innovation Evaluations Interregional Challenges policy framework Innovation budget focus co-operation priorities/strategies policy priorities/ Strategies new value in the design of policy support and poles (€264m) vis current operation capacities are global economy, and innovation measures at the • 3rd priority: orientation programme weak • Innovation-friendly policies local level innovation friendly towards • Important R&D society aimed at remain limited environmental infrastructure- and innovation long-term (€89m) related policy development. investments). measures need • More balance to be increased between financially in research policy order to be and innovation continued policy measures

Finland • Productivity • Clearly visible • Support to • Nearly two thirds of • 1st priority: boosting • Finnish system • Baltic Sea • Disadvantaged development based regional enterprises the total ERDF applied research is less Region regions (main on innovation dimension • Support to resources (€629m) (€216 m) international Programme target of the • Obtaining an • Regional policy networking are allocated for • 2nd priority: than in many • The Northern ERDF internationally is based on the activities innovation purposes promoting innovation other countries Periphery programmes) and is are more leading role in Government’s • Strengthening of friendly environment Programme innovativeness regional policy (€196m) increasingly challenging knowledge falling behind • INTERREG than in a larger strategy rd structures • 3 priority: in this respect IVA Pohjoi regions • Regional • Improving knowledge transfer • Central Baltic Councils are and poles (€219m) • Allocation of • More emphasis accessibility and public INTERREG on the special responsible for the operative IV A administrating, resources to requirements environment of innovation Programme: of networking coordinating regions;) and steering actions in and cluster in national and EU • Environmental relatively these regions cohesion effects and disadvantaged programmes sustainable regions development. •

Germany • Convergence • ERDF • Reflecting • ERDF in Lander • ERDF “subsumed” • Systematic • Dependent on • NIS weakness - programmes - implemented at Lander focus, (10% for under domestic policy evidence specific Application and

Targeting R&D in Lander level, ERDF competitiveness; • Innovation and R&D across Lander transfer of enterprises and supporting implementation 30% for convergence essential for ERDF programmes is programmes knowledge and strengthening basic innovation means focus on regions) programmes rare its economic functions of RIS – policies specific parts of • Convergence regions • ERDF funds at Land • Evaluations valorisation adjusting the deficits • the RIS: applied – EUR 3.143 bn level, mostly spent on available for • Continued of the respective research, and available for project support, individual support for RIS system R&D in innovation (27.7% of focused on the programmes enterprises • Innovation in • Competitiveness the overall ERDF in application phase and • R&D projects services programmes – complemented 2007-13) the private sector – by training, in enterprises • Significant improve performance • Competitiveness about 10% of R&D assessed as of the RIS. Higher consultancy, and expenditure variation in RIS instruments for regions – EUR 1.853 successful. variation in policy bn (39% of total • Convergence – • Multi-annual mix market • Increasing strategic introduction. ERDF emphasis on innovation • Application and knowledge transfer approach at the • More or less the • Decision-making capacity in interface transfer of knowledge dominated by and support to participating and its economic same policy innovation poles and between mixes across the domestic side, not enterprises. research and valorisation ERDF-strategies. clusters – 66%; Lander applied research- • Positive effects the private • R&D spending 24%; innovation in sector mainly by the private friendly environment infrastructure • Policy mix sector (68%) – 11%. • Participation integrating • Competitiveness – in joint infrastructure knowledge transfer research and transfer and support to projects policies innovation poles and showing above clusters – 47%; average return applied research- • Single studies 36%; innovation showing friendly environment positive – 18%. cluster/networ ks effects

Latvia • Providing financial • Single NUTS II • There is no • 27% (€882m) of total • 1st priority: boost • Evidence on • n/a • Achieving a instruments and • Objective 1 formal regional ERDF resources for applied research the shift of support services for policy in terms innovation (€550m) performance emphasis from

science research region of the EU • 2nd priority of the increasing institutions and • Top-down definition. innovation friendly innovation science businesses operating approach in the • There are not environment (€161m) measures is research in technology- design of administrative • 3rd priority: almost non- capacity intensive sectors; innovation entities no knowledge transfer existent towards actual • Improving applied policies regional and poles (€110m) • Implementatio commercialisat ion of the research at • administration n problems universities, other and no separate have stemmed outputs research institutions strategy at the from • Overcoming and in technology regional level insufficient the lack of co- intensive companies • budget co- financing and • Increasing financing entrepreneurial innovation capability culture by promoting • Increased interaction among active innovation actors participation in • international networks

Lithuania • Development of a • Single NUTS II • Innovation • Support amounts to • 1st Priority: boosting • There is no • Baltic Sea • Unfavourable high quality labour • Objective 1 policy is 37.4% (€1,157m) of applied research substantial Region economic and force, region developed and ERDF funds (€516m) evidence on Programme budgetary • Increase in the share implemented • 2nd priority: the 2007-2013 situation • Top-down only at national performance of high and medium approach in the knowledge transfer • CLOE • Substantial added value level and poles (382m) of innovation Programme delays in design of measures co- businesses innovation • No regional • 3rd priority: creating • BSR- drafting and priorities in R&D financed by confirming the • Fostering innovation policies an innovation friendly ERDF INNOnet creation in SMEs. and innovation environment receives documents policy • Implementatio • JOSEFIN • Knowledge (€259m) project • Need for n remains slow strategic dissemination and evidence • INTERREG between entities planning and on impact is as IVC better • Creation of the right yet not legislative infrastructure available. framework • There has been

considerable • Project interest in applicants still R&TD projects lack experience and knowledge of how to prepare the documents needed

Poland • National Regional • Clearly visible • National and • ERDF as the main • Applied research and • Dependent on • Dependent on • Low levels of Development regional regional source of innovation development – 44% specific region specific RIS innovation Strategy 2007-13 dimension priorities are funding of total • At national • Country yet to • 16 regional Ops • All regions have similar. • Science and • Innovation friendly level begin (three relevant for RIS • Level of education mostly environment” – 31% assessment of implementing a the Baltic Sea innovation hope nationally funded, • Innovation poles and ERDF serious Region) to be improved 83% and 96%, clusters – 25% spending is innovation • Implemented as part by, inter alia, respectively. very difficult policy of EU policies direct supports • OP Innovative due to • Enhancing to enterprises, considerable • Key operational Economy – EUR 9.7 selectivity of develop bn (ERDF will dispersion of financing programme is the OP potential for information Innovative Economy contribute € 8.25bn, science and innovation (e.g. 12.3% of the total and lack of enterprises • Innovativeness one infrastructure, allocation within the comparable of the six goals financing R&D), data. • Improving NSRF) coordination formulated in the technology • No thorough National transfer, • 16 regional Ops – among EUR 3.25 bn for analysis programmes Development creation of new possible. strategy 2007-13 innovation- innovation + special and projects at environment development • Issue is that national and • Innovation defined in programme for 5 ERDF related regional levels the context of institutions and provision of poorest regions outcomes • Spreading the competitiveness in typically exist the NSRF support to idea of existing, concurrently innovation to encouraging with other wider society cooperation, supports, e.g. training, ESF.

financing • Overall impact of tech parks rather limited. Better result form projects strengthening cooperation between R&D and economy.

Sweden • “Innovative Sweden” • The public • The National • The role of ERDF in • 1st Priority: stimulate • An evaluation • n/a • Limited strategy was sector finances Strategy for supporting research and was completed capacity to presented in 2004. R&D through Regional innovation is innovation and in July 2010 formulate new The main priorities grants paid Competitiveness, significantly growing entrepreneurship in • Swedish ideas and are: education, directly to entrepreneurshi • Over 60% of the SMEs (43%) programmes develop new research trade and higher p & employment ERDF budge (€566 • 2nd Priority: created 3,700 projects (most industry policy areas education 2007-2013 m) is intended to be knowledge transfer new firms and of the projects • There only a number institutions and serves as basis allocated in (35%) 5,000 new seem to be of targeted sectoral for regional innovation jobs in five reformulated research programmes • 3rd priority: version of old innovation • Differences in ERDF innovation friendly regions strategies.(e.g. agencies financed by projects) ERDF. innovation budget enviroment (30%) • Projecst have services) • Several public allocations exist succeed to • Significant gap • Some public agencies agencies are • Five priorities between regions mobilise between policy have their own responsible for are outlined in regional actors documents and strategies (e.g innovation: this national and be practice in the VINNOVA) VINNOVA is strategy: organised in a financed responsible for innovation and more projects RTDI, the renewal, professional • Mismatch Swedish improvement of way between Research skills and innovation Council improved labour projects and supports basic supply, Structural research ,and accessibility, Funds projects Swedish agency strategic cross in relation to for Economic border the time and Regional cooperation and

Country National Innovation Governance Regional ERDF Overall ERDF innovation Evaluations Interregional Challenges policy framework Innovation budget focus co-operation priorities/strategies policy priorities/ Strategies Growth is sparsely horizon responsible for populated enterprises and regions in competitiveness Northern Sweden Source: DG REGIO: Expert Evaluation Network delivering Policy Analysis on the Performance of Cohesion Policy 2007-2013. Summary by Technopolis Group

Appendix F BSR interesting case studies

Case 1: Lithuania – Integrated centres of science, studies and business (“Valleys”) In November/December 2008, the Government of the Republic of Lithuania adopted a resolution on the establishment of integrated centres of science, studies and business (“Valleys”). The Ministry of Education and Science and the Ministry of Economy allocated €400m for the implementation of the Valleys programme through the National Integrated Programme and the General National Research and Science and Industry Cooperation Programme. Funding is from the EU Structural Funds for 2007- 2013 Programming period. Three components constitute the programme – Valleys, Joint Research Programmes (JRPs) and individual projects. Five Valleys have been announced:

• Santara Valley (in Vilnius) specialising in biomedical research, i.e. biotechnologies, innovative medicines, biopharmacy; • Sauletekis Valley (in Vilnius) – laser and light technologies and material sciences (including. nanotechnologies, semiconductor technologies and electronics, civil engineering); • Santaka Valley (in Kaunas) – material science, sustainable chemistry and pharmacy, mechatronics, future energy and ICT; • Nemunas Valley (in the Kaunas region) – agro-science, i.e. agro biotechnologies, bioenergy and forestry, safety and wellness; and • Integrated Marine Science and Industry Center (Valley) (in Klaipeda) – marine technologies and environment. The overall aim of the Valleys programme is to concentrate the potential of scientific research, studies and knowledge intensive business in specific geographical areas. However, to a large extent, the programme is oriented towards infrastructure development of selected HEIs and PRIs with the purpose to upgrade and concentrate the research infrastructure in selected geographic areas. In order to improve the co-ordination and synergies among the Valleys and Valley participants (higher education institutions, public research institutions and businesses) and to have more results-oriented Valley projects, four JRPs were introduced in 2009: Biomedicine and Biotechnology; Engineering and Information Technologies; Materials Science, Physical and Chemical Technologies; and Natural Resources and Agriculture. The goal of the JRPs is to concentrate research potential in selected sectors across Lithuania, improve the effectiveness of EU-funded initiatives, and develop education, training and business co-operation mechanisms. There are 20 R&D infrastructure development projects under four JRPs within five Valleys, which present a mix of Open Access research centres; Studies centres; Science and technology parks; Business incubators and other. These projects are linked by the JRPs as well as funding for research and studies (“soft projects”). It is intended that the combination of infrastructure and soft projects and in specific sectors will accelerate innovation in the selected research areas. In addition to these projects, there are also: • Consoloidation of studies potential projects – relocation of faculties; • Establishment/ relocation of students dormitories; • Installation/renewal of universties’ studies infrastructures;

• Establishment of R&D thematic networks, promotion of associations activities; • Other projects for procurement of equipment Although the process of equipment acquisition has already started, it is still too early to talk about any outcomes. It is also too early to talk about recommending this programme as an example of the regional/national good practice to other policy makers. At the moment, there are a number of key issues that still need to be sorted. Despite the shared will and agreement for cooperation among the HEIs, PRIs, local governments and business, in most cases there is still a naturally prevailing tendency to satisfy the needs and interest of specific HEIs or PRIs and not to consider the wider innovation system. There is also a lack of cooperation experience of Lithuanian science and research institutions, local governments and business, as well as the absence or limited participation of foreign companies. Finally, when the programme was being developed no elements of cooperation with outside Lithuania were considered or indeed the international best practice was accessed and taken into the account. It is now acknowledged that perhaps when developing and implementing individual projects, partners should look outside Lithuania – if not at the wider BSR then at least at the neighbouring countries such as Latvia. These and other issues are hoped to be improved in the course of this programme’s implementation. If the programme develops to cover a mix of infrastructure projects (where real Open Access Centres are established), ‘soft’ projects, players from across Lithuania (rather being purely geographically focused) and players from abroad (whether as users of the new infrastructure or as partners in some projects), it will make an interesting example how different elements of the innovation and RT&D can function together.

Case 2: BioCon Valley BioCon Valley is the regional life-science cluster in Mecklenburg-Vorpommern. It dates back to 1996 when the federal “BioRegio” competition was launched and 17 regions were competing over €100 million that the three winning regions obtained. The competition, the prototype of the new technology policy in Germany, with a focus of a specific technology and with the aim to strengthen the strong was, was open to all regions. Given the evaluation criteria, one can understand the efforts of the participants to present a coherent proposal, that needed to include the strengths of the region in terms of biotechnological research, commercial applications, and a development concept for the future. Other criteria concerned the interdisciplinary of relevant research networks, supporting services such as patent offices, consulting, measures for spin-offs and the settling of new firms. Mecklenburg-Vorpommern was not among the winning regions but the preparation efforts to set up a regional network proved very stimulating and thus, all of the then 17 participating regions are part of the now 25 German ‘bio-regions’. According to patent statistics measuring the German biotech sector by region, the position of Mecklenburg-Vorpommern increased between 2000-2005 remarkably. It started as a region contributing only 1.2% of all German biotech patents in 2000 and was able to increase this share to 3.9% in 2005, having thus the second highest average annual growth with 27%. According to the DPMA, Mecklenburg-Vorpommern is technologically specialised in biotech given that this patent category obtained 11% of all of the region’s patents in 2007, whereas other patent classes are in the range of 2- 3% only. Patent statistics also reveal that science and industry contributed equally to applications. Compared to the leading regions this shows however a lack of the relevant applying industry. Key modalities BioCon Valley Mecklenburg-Vorpommern e.V. is a non-profit association funded 2001. It has the aim to to promote cooperation with other regions in the filed of life sciences with other regions, in particular the BSR. Partnership and governance The cluster has about 160 members from industry, research, public bodies and support organisations, but also hospitals and service-oriented establishments like hotels. Between 1997-2007, the number of companies in the cluster increased from 44 to over 90. The number of employees increased form 550 to 2,400.

Activities supported The BioCon Valley started as a life-sciences cluster. Since 2004 it pursues equally ‘health’ which is of course closely connected in terms of its life-science research base, yet in terms of applications it differs. It terms of the industrial fields of its member firms, 55% are in biotech, 20% in medical technologies, 2% in pharma and 22% in other fields. About 40% of the firms are located in incubators, 10% next to the Greifswald university. BioCon Valley is an important ‘network broker’ – it actively pushes the concept for turning the region into the Number 1 health economy region in Germany. As such it manages also hic@re - the “Health region of the future” project that the region won in 2010 in a federally funded competition.

BSR co-operation: extent to which potential for BSR level synergies or co-operation

was integrated from an early stage in planning The cluster started to establish cooperation with international partner regions early on. Its clear focus is on the Baltic Sea regions but it is not exclusively limited to the BSR. In 2001, BioCon Valley started together with the Medicon Valley Academy, and BioTurku the EU-funded initiative ScanBalt. Since 2004 it has its own legal entity and functions as a meta network for 40 life sciences regions in the BSR that brings together about 60,000 employees in this sector. The cluster extended its contacts to south-east Asia, where it maintained a cooperation with the Japanese prefecture Mie. This project was funded by the Japanese External Trade Organisation under its Region-to-Region programme. BioCon Valley is also a partner in the North German cluster Biokatalyse 2021 (Biocatalysis 2021) which obtains mainly federal funding. The partner provides public relations and facilitates its internationalisation strategies which are important to attract further private partners. In December 2008, a life science marketing measure started in order to form a joint platform for the regions Greifswald and Szcecin. It aims at cross-border exchanges of information and the initiation of joint projects, in particular under FP7’s life sciences programmes.

Funding (incl. identification of ERDF or other EU funds) and public/private split BioCon Valley is a registered non-profit organisation. As such its members pay an annual fee which is structured by type of member (firms by income, public bodies, individuals, etc.). As a non-profit organisation, there is no legal obligation to publish a balance sheet. The cluster obtained €4 million from the ERDF in 2007 for the coordination of health measures in the land. For the years 2008 and 2009 it obtained equally ERDF funding for its annual national and sectoral conference (€149,100 and 157,800 respectively). It obtains funding for the management of the federally funded initiative hic@re, worth about €7 million over 2010-2014.

Main outcomes to date As a network broker, the BioCon Valley cluster initiative has brought a noticeable stimulus for the regional development in Mecklenburg-Vorpommern. Its technological avenue towards positioning the region as a leading location for the health economy may indeed help the region to develop a unique profile within Germany, and having the large BSR as potential cooperation partners due to its inclusion in ScanBalt may also prove to be a valuable asset.

Lessons for other BSR: The smart specialisation strategy of Mecklenburg-Vorpommern can indeed be used as a model for several other, industrially weak regions in particular in Poland and the Baltic States. The choice for biotechnology – life sciences is somewhat due to chance – given that the first technological competition targeted this field. As an instrument the bottom-up initiatives proved to create a dynamic that was taken up and fostered by the regional government. Given that biotechnology offer many technological avenues and applications in several industries, a region focussing on biotechnology still needs to chose a particular field. Here the way the region mapped its competences (see policy brief), set up a strategy and implemented measures is certainly instructive and can be applied in many other regions.

Case 3: The Pomorskie Voivodeship (Poland) – Support for Strategic Clusters Many regions across the EU support clusters because there are several potential benefits. Firstly, an effective cluster can lead to the increase of local enterprises productivity. Secondly, spatial proximity can be a source of innovation. It is worth to mention here knowledge transfer, competition, and science-industry co-operation. Thirdly, the remaining positive effects of clusters include among other things better access to services provided by business intermediary organisations, an increase of investment in infrastructure as well as higher income per inhabitant. In a nutshell, the rise in popularity of clusters among policymakers can be explained by the fact that clusters are viewed to have potential of becoming engines of regional competitiveness and economic growth. Taking into account the above-mentioned considerations, the Pomorskie voivodeship is not an exception. Almost two years ago, it formally adopted the ‘Regional Cluster Programme: 2009-2015’. Comparatively to other Polish regions, this programme is unique mainly because it supports clusters which are evaluated as strategically important for the development of the Pomorskie voivodeship. The main objective of the programme is to strengthen the competitiveness of the Pomorskie economy through the support to regional and local clusters. The programme foresees the support for three types of clusters, including: (1) strategic clusters, (2) sub-regional (local) clusters, and (3) embryonic clusters (technological networks). The main benefits of obtaining a status of strategic cluster are three-fold. First, the cluster can receive support for the functioning and development of cluster, including co-financing of cost related to activities of the cluster animator, promotion and marketing materials, as well as technology transfer and observatory / monitoring types of projects. Second, preferences can be given to proposals submitted by those strategic clusters for certain support measures of the Regional Operational Programme and the regional component of Human Capital Operational Programme. The third benefit associated with the status of strategic cluster is that regional authorities can issue a recommendation which can be presented during the application for other public support programmes (e.g. EU Structural Fund interventions – National Operational Programmes, the Seventh Framework Programme, and the European Territorial Co-operation Programme). In order to avoid lock-ins, it is planned that new competition will be organised to select strategic clusters before the launch of the 2014-2020 financial perspective.1 So far, three initiatives have obtained a status of strategic clusters. The Baltic Eco-Energy Cluster (BEEC) is a common initiative of the Polish Academy of Science Institute of Fluid-Flow Machinery, University of Warmia and Mazury, Gdansk University of Technology, Koszalin University of Technology, Marshals and Self-Governments of the Pomorskie and Warmińsko-Mazurskie Voivodeships, as well as the economic units and associations having their seats in those voivodeships. The main mission of BEEC is to introduce and promote a widely understood idea of distributed co-generation, understood as simultaneous small and medium scale production of thermal energy and electricity from renewable energy sources, mainly biomass, but also by converting water, solar and wind energy.2

1 Regional Programme of Support to Clusters for the Pomorskie Voivodeship for years 2009 – 2015. Available only in Polish at: http://www.pomorskie.klastry.pl/upload/pages/493_program%20wspierania%20klastrow.pdf 2 http://www.bkee.pl

The Pomeranian ICT Cluster brings together some 70 organisations from the business and science sector. The initial steps towards establishing the Pomeranian ICT Cluster were taken during the implementation of projects during the 2005-2008 period undertaken by the Centre of Excellence – WiComm at the Technical University of Gdansk. As a result, enterprises from the ICT sector overcome a lack of trust and become convinces about the benefits stemming from the co-operation and knowledge transfer. The main objective of the cluster is to establish favourable conditions for the development of enterprises from the ICT sector in the region through the supply of knowledge, supporting innovation, fostering co-operation between firms and other institutions as well as implementation of joint goals of cluster members. With regard to planned activities, the Pomeranian ICT Cluster aims at establishing co- operation with 18 European ICT clusters participating in the BSR Stars – Mobile Vikings project (2010-2013).3 According to the 2010 ranking commissioned by the Polish Agency of Enterprises Development and prepared by Delloitte, the Pomeranian ICT Cluster was as the best cluster among 47 analysed Polish clusters.4 The Construction Cluster obtained a status of strategic cluster in December 2010. The co-operation in the framework of that cluster was initiative in 2007 and in the same year the cluster was registered as Ltd. company. Initially the cluster consisted of 18 members and currently brings together 42 entities. It is planned that until 2015, the Construction Cluster will become a leading organisation of construction sector in the North of Poland with developed national and international networks allowing its members to systematically increasing and exploiting human, technological and financial potential.5 Process of developing the Regional Cluster Programme The starting point of the programme was the 2005 Regional Development Strategy of the Pomorskie Voivodeship, which pointed out to the need of creating favourable environment and conditions for establishing clusters. It is also important to mention the European Social Fund project ‘Stimulating the economy innovativeness of the Pomorskie Voivodeship through the support to clusters’. This project was undertaken by a leading research organisation specialised in the field of clusters and cluster policies, namely the Gdansk Institute for Market Research during the 2005-2008 period. In the past, the institute had already been involved in similar assignments. For instance, it elaborated the concept of cluster policy at the national level commissioned by the Ministry of Economy back in 2004. Prior to the adoption of the 2009-2015 Cluster Programme, the public consultation as well as ex-ante evaluation was carried out. The most important lessons to be drawn from the case of the Pomorskie Voivodeship is that developing programmes such as the Cluster Programme is a long-term process, it involves a lot of efforts and many stakeholders. In order to succeed, establishing priorities is not enough. They key to success is to systematically monitor regional trends, in order not to loose sight of new emerging opportunities.

3 http://www.pomorski-klaster-ict.pl 4 http://www.madeinpomorskie.pl/article/38421_Laury_dla_Pomorskiego_Klastra_ICT.htm 5 http://gkb.idhost.pl/

Case 4: Nordic – Baltic Mobility Programme for Business and Industry Nordic–Baltic Mobility Programme for Business and Industry is a Grant Programme developed in a cross–border co-operation. Programme is operational from the beginning of 2009 and is planned to be operational for the period 2009 – 2013. The Nordic–Baltic Mobility Programme for Business and Industry is part of a longer Nordic-Baltic co-operation that was initiated in 1991 and has developed into a political co-operation in areas of joint priorities. The programme aims to strengthen business co-operation, entrepreneurship, and regional cluster co-operation between the Nordic and Baltic (Denmark, Estonia, Finland, Iceland, Latvia, Lithuania, Norway and Sweden) countries. The Nordic–Baltic Mobility Programme for Business and Industry provides financial support to different stakeholders in the fields of business and industry to carry out study visits, internships, on-the-job training or network and cluster facilitating activities in Baltic or Nordic countries. The aim of these activities is to strengthen cooperation within the priority areas of the programme. The priority areas for 2011 are: • Green Growth • Health and welfare innovation • Entrepreneurship and young entrepreneurs • Business incubator network • Promoting cluster cooperation aimed at global markets, especially in creative, innovative and knowledge-based industries • Initiatives to identify and remove barriers to trade and mobility within the Nordic-Baltic region. To receive the grant, participation of minimum three countries is required. One of these countries has to be Nordic and one Baltic country. The programme covers 70 % of travel, accommodation and co-operation costs. Calls for applications are organized annually. The programme is administered by the Nordic Council of Ministers’ Office in Latvia (the Management Body). Partners that designed the programme and are participants in the programme are the Nordic and Baltic (Denmark, Estonia, Finland, Iceland, Latvia, Lithuania, Norway and Sweden) countries. The Nordic Council of Ministers (NCM) decides on the operation and funding for the programme. The annual budget of the programme is financed by the Nordic Council of Ministers and the governments of Estonia, Latvia and Lithuania. Co-funding from beneficiaries is required. In 2009 and 2010 in total 101 projects were funded. Beneficiaries where businesses and organisations supporting the private sector. Several projects resulted in continuous cooperation between the involved parties, for example, Latvian Transport and Logistics cluster initiated FP7 project with the partners from the mobility programme project. Business incubators from Latvia and other BSR countries initiated the project IBI Net that is funded by BSR Programme 2007 – 2013. SMEs and business support institutions around BSR are interested in cooperation and share many common topics to explore and learn from each other. Mechanisms to initiate and support the co-operation at initial phase are necessary and as several examples from the Nordic – Baltic Mobility Programme for Business and Industry show, the projects are further developed with the help of other support mechanisms or independently.

Case 5: Transnational Cluster Cooperation in the field of ICT in the BSR/ “Mobile Vikings” Type of initiative: transnational cluster cooperation Operational from – to: n.a. The ICT sector in the Baltic Sea Region is highly developed with advanced technologies hosting many important ICT clusters. This is also the reason why this sector was selected as one of the pilot areas of the former Baltic Sea Region Innovation Network6. Participating cluster organisations in the ICT pilot were Øresund IT, HERMIA - Competence Cluster for Ubiquitous Computing, Mobile Heights, Latvian IT Cluster, ICT Pomerania from the countries Denmark, Sweden, Finland, Latvia and Poland. Themes of cooperation included topics such as ICT solutions for low-energy living, support to regional ICT companies at European trade fairs or women as leaders of ICT industry. The cooperation proved to be very successful and resulted in several joint research and innovation projects and multilateral and bilateral business alliances. The collaboration of ICT clusters continues under the new EU Strategy for the Baltic Sea Region, where one of the actions is to foster transnational ICT cooperation. Specifically in the framework of the project “Mobile Vikings” the objective is to develop new products and services in the field of telecommunication and mobile communication. An important feature of the ICT transnational cluster cooperation is its cross-sectoral nature and impact on other sectors. Key modalities: The aim of “Mobile Vikings” is to excel in new methodologies and tools leveraging Baltic Sea Region’s strengths in telecommunication/mobile applications and services. The key building block of the approach is to exploit the vast theoretical knowledge on open innovation and user and demand-driven innovation and put concrete new methods in practice as part of the innovation strategies of companies, academia and society. Partnership and governance: Mobile Vikings is a consortium of 5 partners from 5 countries. Mobile Heights is the coordinator. Partners are Latvian ICT Cluster, Øresund IT, HERMIA, Competence Cluster for Ubiquitous Computing and Visorial Information Technology. There are further 11 associated partners from Norway, Demark, Poland, Germany, Finland and Sweden. Activities: The collaboration is focused on creating new products and services in new and growing companies piggy-backing on the international networks of global enterprises. It is about new user- and demand driven business and innovation models that have to be implemented to secure jobs and competitiveness. Thematic Area is Digital Business and services and ubiquitous solution. The activities include the development of test beds for new products and services in the telecommunications/mobile applications area. Secondly, it will investigate how open innovation methodologies can become part of cluster management. Third, the project will aim at creating a real and unified Baltic Sea market in the specific field. Funding: BSR transnational programme: ERDF

6 http://www.proinno-europe.eu/bsr-innonet/project-overview

Figure: ICT transnational cluster cooperation – map of some of the key partners

Case 6: Skåne Food Innovation Network (Skånes Livsmedelsakademi) Type of initiative: Permanent organisation, describes itself as the hub of one of the most interesting food manufacturing clusters in Europe. Activities are business driven, and there are close ties with universities, secondary schools, and food industry’s business development oranisations in the region. Involved in bilateral, cross-border activities. Member of Øresund Food, “your knowledge and innovation network within the food value-chain”. Some BSR outreach, but mainly to Denmark, rest of supply chain seems to reside in Skåne. Operational from: 1994 Context /short history: Formed on the initiative of industry, to deal with upcoming Swedish EU membership and increasing international competition. Grew quickly into a well working network, with large commitment from industry, research and society. Working widely to develop the Swedish Food Industry, through increased innovation rate and value added. Also tries to increase attractiveness among young, well educated people, to develop the sector. Seeks to disseminate knowledge about the modern Skåne food culture, and how it can contribute to health, well being and positive food experiences. Key modalities: Partners are 40 larger companies and organisations. They are not limited to the region, but also larger companies with parts of their business in the region (There is, however, also Fundación Chile). Members are around 35 smaller enterprises from across the entire value/supply chain. There is a board with representatives from companies, research and society, to reflect the width and strengths of the Skåne food industry. Daily business is run by a Managing Director, and a team managing five different business areas. Among activities we find education, dealing with public opinion issues, arrangement of seminars and theme days for both specialists and a broader audience. Several activities are performed in networks, where mainly partners are represented. The networks are: Foresight Network, Food Research Network, MD Network, Entrepreneur Council, R&D Network, Retail Network, HR Network, Advisory Board (young people), Supply Chain Network, and Politician Network. Funding includes partner and member fees, but also grants from national funding agencies; where VINNOVA is the main contributor, through the VINNVÄXT programme, SEK 10 million a year for 10 years, starting 2003. All VINNVÄXT funding requires 50% regional funding, which means that the total funding is at least SEK 20 million during 10 years. Main outcomes to date: Established cluster co-operation and knowledge transfer between industry, universities, organisations and public authorities to form the food trade and industry for the future. Smaller enterprises are supported in product development and outreach to the public. Organisation also support in public procurement as well as development of purchase, distribution and meals production. There is also a trainee programme. Lessons for future BSR networks: Secure simultaneous involvement and commitment from industry, universities and organisations for business and/or user driven operations. Conduct openness and transparency. Knowledge should be made explicit and transferable in and between stabilised environments/organisations.

Case 7: Robotdalen

Type of initiative: Cluster project, enabling commercial success of new ideas and research within robotics and automation. Operational from: 2003 (as a VINNVÄXT winner) Context /short history: Robotdalen was set up as an initiative where the vision is to take the lead in research, development and manufacture of industrial, field and medical robotics. The key to its success has been an environment in which actors in the fields of advanced research, higher education and industry have collaborated, with encouragement of innovations and new enterprises. The cluster project has been successful in mobilising stakeholders from the entire region, including major companies such as ABB, Atlas Copco and Volvo. The first Swedish university course in robotics is located here. Key modalities:Partnership and governance: Board is led by the county governor of Örebro county, and consists of one municipality mayor, together with directors from both companies, universities and public organisations. Management consists of a process leader with administration, county coordinators and five additional deputy process leaders, responsible for core areas (the main process leader is also responsible for one core area, which makes them six in total). Activities are solely following from the fact that Robotdalen is a robotics initiative enabling commercial success of new ideas and research within robotics and automation, focusing mainly on solutions for the industry, heavy vehicles and health care sector. Within Field Robotics, support concerns research and development of different types of service robots, focusing on heavy autonomous vehicles. Industrial Robotics is mainly about solutions and support for increased competitiveness in SME:s. Technology for Independent Life is about enhancing quality of life for elderly, disabled and health care staff. Around 40 projects ongoing continually. BSR co-operation: No BSR level synergies seem to have been integrated from an early stage in planning, nor is any such development apparent from the annual reports. Priorities in the international work is rather aimed at strategic recruitment, partnerships and networking in general and towards establishing new companies in the region. Funded by VINNOVA, the European Regional Development Fund, the European Social Fund and a number of public institutions, universities and companies in Central Sweden. Funding from the European structural funds amount to 25% of the funding for some years, thus making it significant in leveraging the development of the project. The regional funders in Central Sweden are the county administrative boards and county councils in the counties of Södermanland, Västmanland and Örebro, regional federations in the counties of Södermanland and Örebro, the municipalities of Eskilstuna, Karlskoga, Laxå, Västerås and Örebro, Mälardalen University, Örebro University. Among the funders and collaborative partners from the industry are ABB, Atlas Copco, Volvo Construction Equipment, ESAB, Danaher Motion, Linde Material Handling and Stora Enso and a vast number of small and medium-sized enterprises in the region. Main outcomes to date: Goal is 35 new companies and 35 new products within robotics and automation before 2013. So far 17 companies and 17 products have been achieved. There is strong political support by counties. Been particularly effective in strengthening awareness of Robotdalen in Sweden. Process management is highly capable and appreciated. Course in Master of Engineering has been established, and post-graduate school, Intelligent Systems for Robotics, Automation and Process Control, has been set up.

Lessons for other BSR: Matching of European and national agency funding with local funding seems to build in necessary local commitment and engagement, which serves to warrant that individual initiatives are well grounded in local reality. Economic development has a long term horizon. Any main or major funding body or core funding must therefore be long term and sustainable. In the case of Robotdalen, core funding is 10 years, unless periodical evaluations show major failure to develop according to plans.

Case 8: Uppsala Innovation Centre (UIC)

Type of initiative: Business incubator for growth companies in the Uppsala region. Operational from: Company registered 1999. Context/short history: UIC is a part of the Swedish national incubator program (IBIP) run by Innovationsbron, and participates also in the EU projects PRIM and IIM. UIC offers four different incubator programmes, with a sum of 65 participating companies; UIC Business Start (39 participants), UIC Business Lab (43), UIC Business Accelerator (22) and UIC Alumni (24). Key modalities: Partnership and governance: Company has four owners; ALMI Företagspartner, SLU Holding (at university of agriculture), STUNS (Foundation for co-operation between universities) and Uppsala university Development. The 24 partners are contributing with knowledge and competence through seminars, individual advice and contributions to the funding of UIC. They are a mix of privately and publically owned companies, national authorities and other organisations. The board of directors are from the same wide variety of organisations, and the managing director manages eight other people in the staff responsible for different aspects of the incubator programmes. Activities supported: A business incubator, such as UIC supports start-up companies that want to develop new ideas to become strong growth companies. It provides management and financial assistance as well as access to commercial and technological networks. BSR co-operation: The only visible connection outside the region seems to be some funding from the EU regional fund, through the Swedish Agency for Economic and Regional Growth, and a bilateral co-operation partnership in Shanghai, China. Gross turnover 2009 was SEK 16,6 million. UIC’s own regular business was funded completely by partners, where Innovationsbron has the largest part through the IBIP- programme. Main outcomes to date: Around 140 companies have been part of the incubator programmes. A network of around 50, by the board of directors approved, business coaches is established. Investments in the incubator companies 2009 were SEK 141 million in venture capital and SEK 69 million in contributions and loans. Lessons for other BSR: UIC itself points to a number of key success factors; 1) the range of programmes, 2) the business coach model, 3) UIC has no ownership in the incubator companies, 4) focus is on business development, not on letting out premises, 5) clear and reciprocal demands between UIC and companies, 6) continuous, monthly reports from business coaches, 7) the companies appreciate the efforts and are willing to pay for them, and 8) strong co-operation between actors in the innovation system.

Case Study 9 : BONUS for the Baltic Sea Science – Joint Baltic Sea Research and Development Programme

The Bonus project aims to achieve a common understanding of the Baltic sea ecosystem. It seeks for sustainable solutions for the Baltic sea region. Fundamentally, the programme brings together the research community of marine, maritime, economical and societal research to address the main societal challenges faced by the Baltic Sea System, and more particularly in the maritime eco-system. In the core of the grand challenges are, among others, adaptation to the climate change, achieving good environmental status of the Sea, sustainable and safe use of the goods and services, evaluation and development of relevant policies and collective governance of the human activities. Also, attention is given to maritime and coastal spatial planning in the Baltic Sea region based on the ecosystem approach and enhanced cross-sector and cross-border cooperation, as required by EU Integrated Maritime Policy. In the light of the abovementioned common goal, Bonus particular objectives can be grouped in four manifolds:

• Enhanced understanding of the needs for research on the Baltic sea • Improved co-operation among different stakeholders and efficiency of the research capacity in the BSR • Generation and transfer of scientific knowledge to support European, national and regional coastal and marine environmental policies • Broader involvement of scientific disciplines and the number of scientists in the Baltic Sea research system

Operational from: 2004 (BONUS ERA-NET)

Context/short history

At the beginning of the present decade, increasing debates around fishing rights and the pollution of coastlines by oil spills highlighted the need for a better international scientific collaboration to support decision-makers. In this context, in 2003, the European Commission was determined to support a new project to improve environmental and sustainable development of the Baltic Sea. This new project was called BONUS ERA-NET. The BONUS ERA-NET, which run between 2004-2008, was a joint project developed by 12 research funding and coordination agencies around the Baltic Sea Area to develop the foundations for the establishment of a Joint Baltic Sea Research Programme. A dedicated legal entity, Baltic Organisations Network for Funding Science EEIG, was equally established in 2007. Following BONUS ERA-NET, in 2007 BONUS+ pilot followed to test the system of collaboration among the national funding institutions launching it first call for proposals. The current BONUS programme 2010-2016, or the so-called BONUS-169 is, as a result, acting as continuation to the previous BONUS ERA-NET and BONUS+. The BONUS programme provides thus an umbrella under which all-previous phases, activities and achievements are captured. Between 2010 and 2011, the BONUS programme focuses on the strategic development and preparation for the subsequent implementation phase. The implementation phase, which will run between 2012-2016, seeks to prepare at least three joint calls for the promotion of a deeper integration of research policies, infrastructures, training programmes, exploitation and

dissemination of research products. Funding The Bonus project funded under the ERA-NET scheme as part of the FP6 2002-2006, was funded by the EU as well as all members and associated members of the EEIG. The EU contributions amounted to over €3 million. Its successor, Bonus+ and its call in 2007, funded a total of €22 million, two thirds coming from national funding agencies and one third funded by EU ERANET+. During the actual phase of the project for the period 2010-2016, € 100 million have been foreseen, of which 50 million will come from EC funding and the remaining budget from national contributions. Main outcomes to date and lessons for future BSR networks The BONUS ERA-NET project helped bringing together the key research funding organisations from all the EU member states around the Baltic Sea. It was shaped as a consortium of 14 partners - eleven funding agencies, a research institute and two international organizations having regular workshops and meetings. At this first stage, the programme did not offer funding for networking of scientists or research projects. Instead, it made the national research funding organisations cooperate by building up a Joint Baltic Sea Research Programme to fund research. The BONUS+ opened a new stage of cooperation through the call for proposals launched in 2007. The programme has funded a total of 16 projects involving over 100 research institutes and universities and has set out to test the mechanisms of collaboration among national funding institutions. In 2011, during their third and final project year, analysis of the obtained data and compilation of the research outputs are ongoing. The results of the projects are not yet available. This will be presented at the Baltic Sea Science Congress Joint research efforts for sustainable ecosystem management on 22-26 August 2011 in St. Petersburg.